Australian Unity Office Fund · ASX:AOF
Australian Unity Office Fund — H1 FY2022 Earnings Presentation
31 slides from Australian Unity Office Fund's earnings presentation, Feb 28, 2022
Slide 1: Australian Unity Office Fund 2022 Half Year Results
30 Pirie Street, Adelaide, artists impression, subject to change Australian Unity Office Fund 2022 Half Year Results February 2022 (ASX: AOF) Webcast | Teleconference 1
Slide 2: Acknowledgement of Country
Acknowledgement of Country Let’s reflect the meaning of place and in doing so recognise the various traditional lands on which we meet. We acknowledge the traditional custodians of the people of the Kulin nations and the traditional owners of the lands where our properties are located and on which e
Slide 3: AOF Overview / Agenda
10 Valentine Avenue, Parramatta, artists impression subject to change A quality, 10 Valentine Avenue, Parramatta diversified metropolitan and CBD portfolio offering affordable accommodation Valentine Place Precinct, Parramatta, artists impression subject to change with amenity, accessibility and rep
Slide 4: AOF Overview
AOF Overview Maintaining Focus Guidance on track Divestments 32 Phillip St sold for $66.0 million 9.5 cpu FFO1,2 5% premium to 30 June 2021 independent 7.6 cpu Distribution1 valuation of $62.75 million Increasing occupancy Termination of MID 96.9% occupancy3 The merger implementation deed was +1.2%
Slide 5: Continued focus on maximising returns
Continued focus on maximising returns Future Portfolio Considerations • Multi-tenanted properties continue to perform well. Following strong leasing outcomes, occupancy at multi-tenanted properties increased to 95.7% and WALE of 4.0 years. A further ~2,000sqm have either been executed or are under s
Slide 6: Portfolio assessment
Portfolio assessment AOF portfolio offers optionality to maximise unitholder returns Maintain strong leasing and high occupancy levels in multi-tenanted assets Maintain high occupancy in multi- Deliver the refurbishment and repositioning of key assets within the portfolio tenanted assets • Provides
Slide 7: Financial Results
Financial Results Australian Unity 7 2 - 10 Valentine Ave, Parramatta artists impression, subject to change
Slide 8: Financial Results – Half year ended December 2021
Financial Results – Half year ended 31 December 2021 FFO and distribution guidance on track FFO1 Per Unit 9.5cpu +0.3cpu, or +3.2%, increase from HY21 driven by fixed rent reviews and increased occupancy Distribution Per Unit 7.6cpu In line with guidance and +0.1cpu increase from HY21 Profit attribu
Slide 9: Property Portfolio
Property Portfolio1 Independent Change in Current Change in All properties were independently revalued at 30 June Property Valuation valuation2 capitalisation capitalisation 2021 and 31 December 2021. ($’m) ($’m) rate2 (%) rate (%) 150 Charlotte Street, Brisbane subsequently revalued at 15 February
Slide 10: Capital Management
Capital Management1 Conservative gearing Gearing2 21.1% Gearing reduced and the headroom increased following the sale of 32 Phillip Street, Parramatta Debt facility limit remains $250 million with $118.7m of headroom at 31 December 2021 Drawn debt has increased to $167.3 million at the date of this
Slide 11: Portfolio Strategic Update
10 Valentine Avenue, Parramatta, artists impression subject to change 10 Valentine Ave, artist’s impression subject to change 10 Valentine Avenue, Parramatta Portfolio Strategic Portfolio Update Review Property Opportunities Portfolio Australian Unity 11
Slide 12: Value-Add and Multi-Tenanted property details
Value-Add and Multi-Tenanted property details Independent Capitalisation NLA2 Value WALE3 Occupancy Market Property State Valuation ($) rate (%) (sqm) $/sqm (years) (by NLA) Parramatta 10 Valentine Ave, Parramatta NSW 107.80 5.50% 16,020 6,729 0.5 97.3% Parramatta 2 Valentine Ave, Parramatta NSW 41
Slide 13: Refurbishment and Repositioning Opportunities
Refurbishment and Repositioning Opportunities AOF’s largest 3 tenants, represent ~51% of the NLA, ~59% of gross income1, expire over the next 30 months 10 Valentine Ave, Parramatta 30 Pirie St, Adelaide • Built in 1987, comprising 14 levels of office space, occupied by PNSW for 25 years, • Built in
Slide 14: Refurbishment and Repositioning Opportunities
Refurbishment and Repositioning Opportunities 2 and 10 Valentine Avenue, which combined provide the opportunity to deliver Valentine Place 10 Valentine Avenue The proposed project involves the replacement of the façade extended floorplates to create additional NLA, new plant, new lobby and contempor
Slide 15: Refurbishment and Repositioning Opportunities
Refurbishment and Repositioning Opportunities 30 Pirie St, Adelaide The proposed project involves refurbishment of the property to reposition to current PCA A grade in the heart of the Adelaide CBD on an island site of 3,040sqm. The objective is to create a workplace that is attractive to tenants, d
Slide 16: Multi-Tenanted Strategic Assets Review
5 Eden Park Drive, Macquarie Park Multi-Tenanted Strategic Assets Review Australian Unity 16
Slide 17: Multi-Tenanted Assets
Multi-Tenanted Assets Active management driving increasing occupancy, income and valuation growth 5 Eden Park Drive • Leasing success has increased occupancy to 100% (96.3% at 30 June 2021), with the independent valuation increasing by +$6.5 million • Subsequent to 31 December 2021, a 6-year lease o
Slide 18: Outlook and Strategic Guidance Review
150 Charlotte Street, Brisbane, artists impression subject to site amalgamation and change Outlook and Strategic Guidance Review Australian Unity 18
Slide 19: Outlook and Guidance
Outlook and Guidance Guidance 18.0 – 18.5 cpu 1 FY22 FFO Guidance FY22 Distribution Guidance 15.2 cpu1 Outlook Maintain active management strategy on the multi-tenanted assets, delivering strong leasing and occupancy outcomes Progress refurbishments and repositioning opportunities on the value-add a
Slide 20: Appendices
Appendices Australian Unity 20 10 Valentine Avenue, Parramatta, artists impression lobby, subject to change
Slide 21: Income Statement
Income Statement $’000 HY2022 HY2021 Change Reduction in rental income and property expenses Rental income1 26,376 28,182 (1,806) driven by the sale of 241 Adelaide St, Brisbane Property expenses (6,021) (8,184) 2,163 Straight lining of rental income and amortisation of leasing (2,530) (4,026) 1,496
Slide 22: Balance Sheet
Balance Sheet $’000 31 December 2021 30 June 2021 Change Assets Other assets predominately relate to the deposit paid Cash and cash equivalents 9,663 8,935 728 on 96 York Street, Beenleigh Receivables 112 592 (480) Other Assets 1,936 999 937 Financial assets held at fair value through profit or loss
Slide 23: Property Portfolio
Property Portfolio As at 31 December 2021 Key Portfolio Metrics Lease expiry profile1 Number of properties 7 40% Telstra 35% 30 Pirie St Occupancy1 96.9% 30% PNSW 25% Portfolio Value $572.4m 10 Valentine Ave 24.9% Boeing 20% 150 Charlotte St Weighted Average Capitalisation Rate 5.77% 15% 17.1% 9.8%
Slide 24: Sustainability Framework
Sustainability Framework AOF Portfolio registered with GRESB - the global ESG GRESB Aspect Scores benchmark GRESB Measures measure performance of both the portfolio and assets against other participants • Extract performance data for benchmarking and gap analysis and value identification • Measure p
Slide 25: Sustainability Measures
Sustainability Measures Asset Enhancement Assessments – driving sustainability Asset Benchmarking Report enhancements • Extract building performance data for benchmarking and gap analysis and value identification • Measure performance across 10 categories determining an Asset Performance Score • Def
Slide 26: Environmental, Social & Governance Framework
Environmental, Social & Governance Framework AOF will invest, develop and manage assets to maximise unitholder value, with a focus on environmental, social & governance principles Transparent Environmental Collaborate with Invest in long term Impacts Tenants sustainability NABERS – Water and Reposit
Slide 27: Market Outlook
Market Outlook Inflationary Pressures - global and local Economic Risks • Key to avoiding future global recession will be to contain inflation blow out; eventual easing of supply chain pressures for both goods and labour while wages growth peaks in late 2023 • Equity markets challenged if inflation
Slide 28: Commercial Transactional Levels
Commercial Transactional Levels Liquidity is moving back to pre-pandemic levels Commercial property transactional levels Commercial property capital flows • Appetite for office property still in demand in 2021 and marginally less the buoyant • Offshore capital still find the Australian commercial pr
Slide 29: Real Estate Pricing
Real Estate Pricing Real estate relationship with inflation and bond yields • Industrial and logistics take up at unprecedented levels with Melbourne take up at 65% of the 2021 national take up • Continued logistics demand growth is expected Source: JLL Research prepared for Australian Unity Decembe
Slide 30: Important notice and disclaimer
Important notice and disclaimer This information provided in this presentation is issued by Australian Unity Investment Real Estate Limited ABN 86 606 414 368 AFSL 477434 (AUIREL), as responsible entity for the Australian Unity Office Fund (AOF). AUIREL is owned equally by subsidiaries of Australian
Slide 31: Australian]
Australian] Real Wellbeing
Australian Unity Office Fund — H1 FY2022 Earnings Presentation on 6ix