Gdi Property Group · ASX:GDI
Gdi Property — FY2024 Earnings Presentation
38 slides from Gdi Property's earnings presentation, Aug 26, 2024
Slide 1: Annual Results
a i Annual Results I cht 26 August 2024 PROPERTY GROUP
Slide 2: Acknowledgement of Country and contents
Acknowledgement of Country GDI acknowledges and pays respect to the past, present and future Traditional Custodians and Elders of this nation and the continuation of INTRODUCTION DELIVERING ON FINANCIAL SNAPSHOT cultural, spiritual and educational practices of STRATEGY Aboriginal and Torres Strait I
Slide 3: Continued Strong Leasing Momentum
Over 37,000sqm of office space leased in FY24 > Continued leasing momentum into FY25 > Leasing efforts reflected in FY25 property income > The leasing deals completed in FY24 underpinned NTA1, particularly the core asset contribution WS2 officially opened > Marking the launch of Perth’s first timber
Slide 4: Core Properties: Westralia Square
Westralia Square > Minister of Works (WAPOL) secured for entire lower lift bank, encompassing 16,347sqm (approximately 50% of the NLA), until March 2034 > Leases executed for Hexagon (level 16) and Infosys (1,037 sqm of level 17) for 5 years, leaving only part level 17 (~700 sqm) vacant > WALE of 7.
Slide 5: Core Properties: WS2
WS2 > New tenants welcomed and occupying (Arup, Built, Savills, Navitas, Liberty) > Tenant fitouts and conference amenity further enhances building > Targeted approach on two unlet floors (level 8, GDI special fitout and level 10, whole floor user) > WALE of 8.5 years and occupancy of 82%, with no e
Slide 6: Leasing and re-positioning Core Properties
MILL GREEN COMPLEX COMPRISING: 197 St Georges Terrace - Leasing up in accordance with our targeted part floor fitout strategy > Leased over 6,000sqm of NLA, with occupancy increasing to 78% > Achieving target rent profile and lower incentives, shorter LCDs > Progressing well on the balance and remai
Slide 7: Co-living JV
Co-Living | Newman, South Hedland and Norseman > Repositioning of South Hedland has improved occupancy, client mix and revenues > Completed acquisition of Newman and commenced repositioning > Consideration of benefit of additional rooms at South Hedland > Norseman tenant, Pantoro recapitalised +$100
Slide 8: Extension of Syndicated Facility
> Converted the principal facility to a syndicated facility, introducing a second Tier 1 financier > Maintained recycling flexibility by increasing the facility by two lots of $25 million, providing capacity with undrawn debt of c. $50 million > Maturity December 2026 > 94% of drawn debt hedged to 3
Slide 9: Financial Snapshot
˃ All assets have been independently valued ˃ Well within policy of sub 40% during FY24 ˃ LVR of 40.6% (covenant of 50%) and ICR of 2.0X (covenant ˃ Weighted average capitalisation rate of 6.6% 1.5X) on the syndicated facility ˃ Average rate/sqm of NLA of $8,0191 ˃ High levels of interest rate prote
Slide 10: Contributors to FFO
Property Division FFO1 higher than previous corresponding period > FFO contribution from Westralia Square and WS2 of $23.7 million, up from $18.1 million from the prior year > Contribution from both assets will continue to grow as leases commence at WS2 > At Mill Green, FFO contribution was lower at
Slide 11: Debt and Interest Rates
Principal Facility drawn to $347.3 million with undrawn debt of $49.1 million 30 June 2024 Maturity Facility Utilised Unutilised Secured Date $’000 $’000 $’000 Syndicated Facility Tranche A Yes December 2026 346,500 322,331 24,169 Tranche B Yes December 2026 50,000 25,000 25,000 A combination of int
Slide 12: Perth Market Key Trends
> Positive net absorption continues +12,000sqm Q2, 2024 > Overall vacancy of 15.9% (increase for premium 7.8% to 12.5%, A Grade down 15.6% to 13.9%), reflecting shift in dynamic from ‘flight to quality’ to ‘flight to value’ > Leasing activity levels are good (expansionary activity, small sub-lease v
Slide 13: WA Economy
GSP Growth Population Growth GROSS STATE PRODUCT PROJECTED TO 2031 AVG. OVER 4 YEARS Gross State Product (GSP) growth Total population to increase by 11% to forecast to average 1.8% over the next 3.2 million people through 2031 four years. Exports Infrastructure Spend % OF AUSTRALIAN EXPORTS OVER NE
Slide 14: Perth market strongest performing office market: Net Absorption
The Perth market has been the strongest performing office market over the last two years 120.0 100.0 80.0 34.87* 60.0 40.0 20.0 (,000sqm) 67.77 78.42 73.83 0.0 -87.99 -61.46 -20.0 -40.0 -60.0 -80.0 -100.0 Adelaide CBD Brisbane CBD Melbourne CBD Perth CBD Sydney CBD *Net absorption for Perth CBD woul
Slide 15: Perth CBD enquiry, utilisation and supply
Perth CBD Enquiry Volume Perth CBD 500+ sqm Deals – Size Change Volume (Sqm) Number (RHS) Expansion No Change Reduction 140,000 160 60 120,000 140 50 12 20 16 120 40 14 100,000 100 30 80,000 80 9 43 20 37 33 35 60,000 6 60 10 18 40,000 11 40 0 -2 -4 -8 -7 -4 -5 20,000 20 (10) 0 0 (20) 1Q20 3Q20 1Q21
Slide 16: Property Portfolio
Independent valuation Carrying Value 30/6/24 30/6/23 Details Date $m Cap rate % $m $m 141 St Georges Terrace, Perth (WS1) 31/12/23 379.0 6.00 385.2 371.0 143 St Georges Terrace, Perth (WS2) 31/12/23 94.0 6.50 99.1 90.0 197 St Georges Terrace, Perth 31/12/23 205.0 7.25 209.5 212.8 5 Mill Street, Pert
Slide 17: Property Portfolio Key Statistics
Weighted average lease expiry1 Key Statistics 100% Occupancy1 87.2% WALE1 5.39 years Weighted average capitalisation rate2 6.63% 80% Average value psm3 $8,019 Total NLA (sqm)2 126,840 60% 1. Excludes 1 Mill Street but includes the showrooms in the Autoleague portfolio and the two Perth CBD carparks,
Slide 18: Property Portfolio
Westralia Square, Perth WS2, Perth 197 St Georges Tce, Perth 5 Mill Street, Perth Valuation Date 31 December 2023 31 December 2023 31 December 2023 31 December 2023 Valuation ($m) 379.0 94.0 205.0 54.0 Carrying Value ($m) 385.2 99.1 209.5 53.9 NLA (sqm) 32,618.7 9,472.6 26,126 7,148 Value ($/sqm) 10
Slide 19: Property Portfolio
1 Mill Street, Perth 180 Hay Street, Perth Murray Street, Perth 301-311 Wellington Street, Perth 3 Valuation Date 31 December 2023 31 December 2023 31 December 2023 31 December 2023 Valuation ($m) 38.3 18.8 42.9 24.4 Carrying Value ($m) 38.3 18.8 43.1 24.4 NLA (sqm) 6,648 4,927 - - Value ($/sqm) 5,7
Slide 20: Property Portfolio
Autoleague WA Stanley Place, Townsville Valuation Date 31 December 2023 2 April 2024 Valuation ($m) 140.57 43.50 Carrying Value ($m) 140.50 43.50 NLA (sqm) n/a 12,820 Value ($/sqm) - 3,393 Discount Rate (%) 7.263 8.50 Capitalisation rate (%) 6.443 8.00 Occupancy1 (of NLA) (%) 100.0 88.0 WALE 2 (year
Slide 21: Fund Business Highlights
GDI No. 43 Property Trust GDI No. 36 Perth CBD Office Trust Council approval to remove both the road Lease transactions with existing tenants has reduced easement and the fixed term right of use provides short-term expiry risks IKEA with the opportunity for long-term tenure and Capital support from
Slide 22: Strategy Execution
> Leased or renewed over 37,000sqm of office space, including all but filling both Westralia Square and WS2, most notably with a combined 16,347sqm lease and lease extension to the Minister of Works for over 10 years at Westralia Square > Completed additional leasing in industrial and retail and seg
Slide 23: Strategy Execution
> Renewed the Board by appointing two new highly qualified Directors following the retirement of Gina Anderson in April 2024 > Successfully navigated the first full year of operations of the Co- living JV, making a small additional acquisition and achieving our return expectations > 20% return on ca
Slide 24: Guidance for FY25
Distribution guidance of; , subject to no material change in circumstances or unforeseen events. We anticipate that a proportion of any cash distribution for FY25 will be paid out of capital. We are pleased to announce that recent leasing successes in our portfolio point to a significantly enhanced
Slide 25: Strategy, vision and proposition
Ensure the GDI skills and capability matches our ability to execute on our DRIVEN BY: INVESTMENT strategy. GDI must have an elite team • Entering and exiting markets ACHIEVE OPTIMAL SHORT TERM AND and recycling our capital to execute our goals and attract the Proposition RETURNS THROUGH A LONG-TERM
Slide 26: Opportunity to increase FFO
Ensure the GDI skills and capability matches our ability to execute on our Fully let “As is” Historical Historical CAPEX FY2025 Comments strategy. GDI must have an elite team net income net income FFO 2024 FFO 2023 FY2024 to execute our goals and attract the best stakeholders. (FFO)1 (FFO 2025) Prop
Slide 27: Appendix
APPENDIX 27
Slide 28: ESG Trends
“The environmental train has left the station” Primary ESG Themes – Perth ˃ Resources industry overtly focussing (offset dirty industry perception) ˃ Majors leading change through supply chain (a “must demonstrate” Emissions Commitment Emissions Commitment criteria) Net Zero by 2050 50% reduction by
Slide 29: Learnings from WS2: The GDI Difference
Learnings from WS2 ˃ Defining the real ESG/Carbon benefits (including embodied) ˃ Proving of timber technology (delivery/cost/design/risk/product) ˃ Recognising timber only works in an adaptable re-use scenario ˃ Opportunity to de-risk via speculation (leasing, programme) ˃ Emerging office occupatio
Slide 30: 301-311 Wellington Street Perth
301-311 Wellington Street Perth ˃ DA approved for 28,000m2 NLA commercial and 51 residential unit development ˃ Setup for government tenant (whole of building) A Appendix 30 GDI Opportunities | Construction Ready Projects
Slide 31: Mill Street Perth
1 Mill Street Perth ˃ Existing Building 6,000m2 ˃ Approved DA 35,000m2 NLA (circa 1,800m2 NLA floor plates) ˃ Opportunity to stage in smaller sub- buildings (and speculate) ˃ Whole of building tenant opportunity for sub-buildings (circa 10,000m2 NLA stages) A Appendix 31 GDI Opportunities | Construc
Slide 32: The Portfolio | Weighted Average Lease Expiry
Westralia Square Westralia Square 2 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% Vacant FY25 FY26 FY27 FY28 FY29+ Vacant FY25 FY26 FY27 FY28 FY29+ 197 St Georges Terrace 5 Mill Street 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% Vacant FY25 FY26 FY27 FY28 FY29+ Vacant FY25 FY26 FY27 FY28 FY29+
Slide 33: The Portfolio | Weighted Average Lease Expiry
1 Mill Street 180 Hay Street 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% Vacant FY25 FY26 FY27 FY28 FY29+ 0% Vacant FY25 FY26 FY27 FY28 FY29+ 235 Stanley Street Autoleague Portfolio 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% A Vacant FY25 FY26 FY27 FY28 FY29+ Vacant FY25 FY26 FY27 FY28 FY29+ A
Slide 34: Balance Sheet
Jun-24 Jun-23 Pro forma for post balance sheet events $’000 $’000 Current assets Cash and cash equivalents 17,014 8,228 Derivative financial instruments 536 730 Other assets 9,958 10,449 ˃ GDI No. 42 Office Trust (Stanley Place) $43.48 million Total current assets 27,508 19,407 ˃ GDI No. 46 Property
Slide 35: Profit or Loss
GDI Trust Jun-24 Jun-23 Jun-24 Jun-23 $'000 $'000 $'000 $'000 Revenue from ordinary activities Property revenue 66,487 60,037 63,929 57,831 Funds management revenue 2,573 2,495 - - Interest revenue and other income 756 437 2,497 806 Total revenue from ordinary activities 69,816 62,969 66,426 58,636
Slide 36: Net Profit after Tax to FFO
GDI Jun-24 Jun-23 $’000 $’000 Total comprehensive (loss) / income for the period (5,584) 20,228 Acquisition expenses - 257 Contribution resulting from consolidated trusts (10,668) (9,103) Distributions / funds management fees received from consolidated trusts 3,991 4,315 Restructure and other non-op
Slide 37: Disclaimer
This presentation has been prepared and issued by GDI Property Group Limited (ACN 166 479 189) and GDI Funds Management Limited (ABN 34 107 354 003, AFSL Number 253 142) as responsible entity of GDI Property Trust (ARSN 166 598 161). Shares in GDI Property Group Limited are stapled to units in GDI P
Slide 38: GDI Property Group
GDI PROPERTY GROUP Me Y