Irish Residential Properties Reit Plc · EURONEXT:IRES

Irish Residential Properties Reit — Investor Presentation (April 2016)

54 slides from Irish Residential Properties Reit's investor presentation, April 2016

  1. Slide 1: Investor Presentation April 2016

    Investor Presentation April 2016

  2. Slide 2: Cautionary Statements

    CAUTIONARY STATEMENTS This presentation has been prepared by Irish Residential Properties REIT PLC (the “Company”) for information purposes only. This presentation does not take into account the impact of reports of new rental and development regulations, and management awaits the introduction of le

  3. Slide 3: Background

    Background Irish Residential Properties REIT Plc (I•RES) was formed when it was a subsidiary of Canadian Apartment Properties REIT (CAPREIT) Initial acquisition of 338 residential apartments from Receiver for Lloyd’s Bank in September 2013 I•RES became a REIT and completed an initial offering of €20

  4. Slide 4: Profile

    Profile • Focus on Irish residential rental sector – Significant supply / demand imbalance • Current portfolio of 2,087 apartments – High quality, well-maintained, wtd. avg. age 8.0 years • Proven ability to grow through acquisition – 1,749 apartments acquired since April 2014 IPO • Ability to devel

  5. Slide 5: Multi Residential Sector Advantages

    Multi Residential Sector Advantages 1 Stable cash flow from diverse resident group  2 Short-term leases, predictable increases(1)  3 Experienced, proven property management  4 Acquisitions at discount to replacement cost  (1) Based on a change in law which came into effect for a period of 4 year

  6. Slide 6: Proven Acquisition Capabilities

    Proven Acquisition Capabilities €519 million total purchase price to date (1) Portfolio (cumulative) City 2,500 Forum Square Tallaght + 442 +8 + 23 Tyrone BSQ Bessboro 2,000 Rockbrook Court +8 + 40 Portfolio + 92 Orange + 270 1,500 Portfolio + 761 1,000 The The Initial Laurels Marker Portfolio + 19

  7. Slide 7: Modern High Quality Portfolio

    Modern High Quality Portfolio Property # of Apartments 1 Kings Court 83 8 2 Grande Central 65 3 Priorsgate 102 4 Camac Crescent 90 5 The Laurels 19 6 The Marker 84 9 7 Beacon South Quarter 225 13 17 6 8 Charlestown 235 4 1 9 Bakers Yard 85 10 14 10 Lansdowne Gate 224 11 Rockbrook Grande Central 81 1

  8. Slide 8: Strong Real Estate Fundamentals

    Strong Real Estate Fundamentals Growing Irish economy -Upward pressure is being applied on employee compensation Significant supply/demand imbalance Strong pipeline for growth -Particularly NAMA, off-market, 600 to 650 apartments for development(1) Strong rental growth opportunities - rents increase

  9. Slide 9: Strong Apartment Outlook

    Strong Apartment Outlook • Significant supply / demand imbalance Dublin • Irish economy continues to strengthen and Housing required wage inflation beginning to enter the economy 2014–2018 5 year period • Increasing apartment sector - Encouraged by government policy - Central bank mortgage limits Ho

  10. Slide 10: Strengthening Irish Economy

    Strengthening Irish Economy Strong 2015 GNP growth and forecast for 2016 6.9% 8.0% 5.7% 7.0% 4.6% 6.0% 5.0% 3.3% 3.3% 4.0% 3.0% 2.0% 1.0% 0.0% 2012 2013 2014 2015 2016F Source: Central Statistics Office, Bank of Ireland Unemployment is dropping 2,200 16.0% 2,150 14.0% 2,100 2,050 12.0% 2,000 10.0% 1

  11. Slide 11: Population Growth

    Population Growth Growing Irish population Ireland population growth (%) 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2011 2012 2013 2014 2015 2016 Source: Central Statistics Office, base year 2010 Population growth is supported by the highest birth rate in Europe Ireland net population change ('

  12. Slide 12: Proven Investment Manager

    Proven Investment Manager S&P/TSX Index & CAPREIT total return • Founded in 1997, one of first Canadian REITs CAP • High returns in rent controlled environment 950% • 46,790 apartments and land lease sites coast-to- coast in Canada(1) • 937 employees(1) − Available and experienced support for I•RES

  13. Slide 13: Successful Business Model

    Successful Business Model Professional Property Attention to Strong Tenant Management Maintenance Relationships Solid Organic Growth 13

  14. Slide 14: Financial Review

    Grande Central | Sandyford, Dublin 18 Financial Review

  15. Slide 15: Significant Accomplishments in 2015

    Significant Accomplishments in 2015 • Secondary equity offering raised €215 million to fund growth in March 2015 • Acquired 410 apartments for total cost of c. €125.5 million(1) • Paid dividends of €1.8 million in 2015 in respect of the 2014 accounting period • Declared dividends of 3.15 cents per s

  16. Slide 16: Strong Occupancy & AMR

    Strong Occupancy & AMR As at 31 Dec 2015 31 Dec 2014 Occupancy 96.0% 99.7% Average Monthly Rent €1,372 €1,250 NRI Margin(1) 80.8% - Weighted Average Rent 12.7% Increase(2) As at 31 December 2015 Portfolio Gross Yield at Fair Value(3) 6.2% (1) For year ended 31 December (2) On turnovers and renewals

  17. Slide 17: 2015 Lease Renewals and Turnovers

    2015 Lease Renewals and Turnovers Turnovers Renewals Q1, 2015 4.0% 26.0% Q2, 2015 6.3% 24.5% Q3, 2015 6.6% 15.2% Q4, 2015 4.3% 10.6% 31 Dec 2015 Turnovers and Renewals 97.5% 17

  18. Slide 18: Strong Operating Performance

    Strong Operating Performance 31 December 2 July 2013 to 31 Year Ended 2015 December 2014 Gross Rental Income (€,000) 24,721 9,675 Net Rental Income (€,000) 19,968 7,626 Fair Value Gain (€,000) 18,639 7,364 Profit (€,000) 30,822 7,930 18

  19. Slide 19: Strong Financial Performance

    Strong Financial Performance 31 December As At 31 Dec 2014 2015 Total Same Property Value Increase(1) +6.7% - Basic & EPRA Net Assets (€,000) 435,020 200,918 Basic & EPRA NAV per share (cents per share) 104.3 99.5 Pro-Forma Basic & EPRA NAV per share(2) (cents per share) 105.3 - (1) Properties owned

  20. Slide 20: I-RES Net Asset Value

    I-RES Net Asset Value • Growth Factors for EPRA NAV:  Portfolio value increases  Strong rental growth  Strong net rental income margin of 80.8% to date (1) • Limiting factors for current EPRA NAV in the short-term:  Two equity capital raises in last 24 months  Acquisition transaction costs  No

  21. Slide 21: Growth Strategies

    The Marker Residences | Grand Canal Dock, Dublin Growth Strategies

  22. Slide 22: Growing the Portfolio

    Growing the Portfolio  Consolidate fragmented Irish apartment market  Significant pipeline of future acquisitions  Intensification and development opportunities  Considering student housing opportunities 22

  23. Slide 23: Significant Acquisition Capacity from Gearing

    Significant Acquisition Capacity from Gearing  Gearing at only 8.6%(1)  Acquisition capacity in excess of €200 million(2)  At target gearing of 45% Enhancing Portfolio  Attractive low interest rates Value  Acquisitions accretive to EPRA EPS (1) As of 31 December 2015 (2) As of 21 March 2016 23

  24. Slide 24: Strong Acquisition Pipeline

    Strong Acquisition Pipeline  €9.6 billion of property assets as of 30 September 2015(1)  Regional exposures estimates were as follows:  Dublin 49% (€4.7bn)  Rest of Republic of Ireland 21% (€2.0bn) NAMA  London 16% (€1.5bn)  United Kingdom 6% (€0.6bn)  Rest of World / Other 8% (€0.8bn) Off-ma

  25. Slide 25: Intensification – Highly Accretive Opportunity

    Intensification – Highly Accretive Opportunity  Opportunity to add approximately 600 to 650 apartments(1) • At currently-owned properties  New apartments can be built at lower cost than market • Significant infrastructure already built (parking, etc.) Note: (1) Subject to planning and any other ap

  26. Slide 26: First Development

    First Development 68 apartments at block B2B (Beacon South Quarter), Sandyford Dublin 18 - LUAS tram line provides direct access to Dublin City Centre within 20 minutes - Sandyford is home to many high profile employers(1) Appointed a general contractor on a fixed price basis Expected Gross Yield in

  27. Slide 27: Growth & Performance to Continue

    Growth & Performance to Continue Continuing rent increases  Strong acquisition pipeline  Accretive intensification opportunities  Accretion through gearing and low interest rates  27

  28. Slide 28: Strong, Steady and Growing dividends

    Strong, Steady and Growing dividends Dividends for an amount of €13.1M (3.15 cents per share) declared in 2016 for the 2015 accounting period Dividends totaling €1.8M paid in 2015 in respect of the 2014 accounting period Sustainable over long term Creating shareholder value 28

  29. Slide 29: Summary

    Summary Significant supply/demand imbalance High occupancy and strong rental growth in the long term Strong NRI margin Acquisition capacity in excess of €200 million based on a target gearing of 45%(1) – At low accretive interest rates Strong acquisition pipeline and development opportunities for gr

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  31. Slide 31: Appendix: Property Portfolio

    APPENDIX Property Portfolio

  32. Slide 32: High Quality Portfolio

    HIGH QUALITY PORTFOLIO Value as at Commercial Average monthly Property Year Date # apartments Total # of 31 December space owned rent per Occupancy Location Location Built Acquired owned(1) apartments(1) (8) 2015(1) (sqm)(1) apt.(1) (2) (3) (1) (2) 1 Kings Court Smithfield 2006 10 Sep 2013 83 83 €17

  33. Slide 33: Kings Court

    KINGS COURT North King Street, Smithfield, Dublin 7 Property details(1) Year Built: 2006 # of apartments owned: 83 Total # of apartments: 83 Valuation as at 31 December: €17.2m Passing rent as at 31 December: €1.3m (annualised) AMR per apartment as at 31 December: €1,288 Occupancy as at 31 December:

  34. Slide 34: Grande Central

    GRANDE CENTRAL Rockbrook, Sandyford , Dublin 18 Property details(1) Year Built: 2008/20092007 Suites: # of apartments owned: 63 65 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 195 AMR per suite Valuation as atas31at 31 December: €1,339 December: €19.3m Occupancy Passing r

  35. Slide 35: Priorsgate

    PRIORSGATE Greenhills Road, Tallaght, Dublin 24 Property details(1) Year Built: 2007 # of apartments owned: 102 Total # of apartments: 198 Valuation as at 31 December: €17.5m Passing rent as at 31 December: €1.4m (annualised) AMR per apartment as at 31 December: €1,045 Occupancy as at 31 December: 9

  36. Slide 36: Camac Crescent

    CAMAC CRESCENT Turvey Avenue, Inchicore, Dublin 8 Property details(1) Year Built: 2008 2008 Suites: # of apartments owned: 90 90 Passing Total # ofrent apartments: as at 31 December: €1.2m (annualized) 110 AMR per suite Valuation as atas31at 31 December: €1,063 December: €17.9m Occupancy Passing ren

  37. Slide 37: The Laurels

    THE LAURELS Main Street, Tallaght, Dublin 24 Property details(1) Year Built: 2007 # of apartments owned: 19 Total # of apartments: 19 Valuation as at 31 December: €2.8m Passing rent as at 31 December: €0.3m (annualised) AMR per apartment as at 31 December: €1,103 Occupancy as at 31 December: 94.7% C

  38. Slide 38: The Marker

    THE MARKER Grand Canal Square, Docklands, Dublin, Dublin 2 Property details(1) Year Built: 2012 # of apartments owned: 84 Total # of apartments: 105 Valuation as at 31 December: €55.9m Passing rent as at 31 December: €2.7m (annualised) AMR per apartment as at 31 December: €2,328 Occupancy as at 31 D

  39. Slide 39: Beacon South Quarter

    BEACON SOUTH QUARTER Beacon South Quarter, Sandyford, Dublin 18 Property details(1) Year Built: 2007/2008 # of apartments owned: 225 Total # of apartments: 850 Valuation as at 31 December: €82.6m Passing rent as at 31 December: €4.8m (annualised) AMR per apartment as at 31 December: €1,479 Occupancy

  40. Slide 40: Charlestown

    CHARLESTOWN Charlestown Place, Finglas, Dublin 11 Property details(1) Year Built: 2007 # of apartments owned: 235 Total # of apartments: 285 Valuation as at 31 December: €54.8m Passing rent as at 31 December: €3.3m (annualised) AMR per apartment as at 31 December: €1,165 Occupancy as at 31 December:

  41. Slide 41: Bakers Yard

    BAKERS YARD North Portland Street, Dublin, Dublin 1 Property details(1) Year Built: 2007/2008 # of apartments owned: 85 Total # of apartments: 132 Valuation as at 31 December: €19.6m Passing rent as at 31 December: €1.4m (annualised) AMR per apartment as at 31 December: €1,283 Occupancy as at 31 Dec

  42. Slide 42: Lansdowne Gate

    LANSDOWNE GATE Lansdowne Gate, Drimnagh, Dublin 12 Property details(1) Year Built: 2005 # of apartments owned: 224 Total # of apartments: 280 Valuation as at 31 December: €60.3m Passing rent as at 31 December: €3.6m (annualised) AMR per apartment as at 31 December: €1,329 Occupancy as at 31 December

  43. Slide 43: Rockbrook Grande Central

    ROCKBROOK GRANDE CENTRAL Rockbrook, Sandyford, Dublin 18 Property details(1) Year Built: 2008/20092007 Suites: # of apartments owned: 63 81 Passing Total # ofrent as at 31 December: apartments: €1.0m (annualized) 195 AMR per suite Valuation as atas31at 31 December: €1,339 December: €26.1m(2) Occupan

  44. Slide 44: Rockbrook South Central

    ROCKBROOK SOUTH CENTRAL Rockbrook, Sandyford, Dublin 18 Property details(1) Year Built: 2008/20092007 Suites: # of apartments owned: 63 189 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 224 AMR per suite Valuation as atas31at 31 December: €1,339 December: €66.0m(2) Occupan

  45. Slide 45: Tyrone Court

    TYRONE COURT Tyrone Court, Inchicore, Dublin 8 Property details(1) Year Built: 2008/20092014 Suites: # of apartments owned: 63 92 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 128 AMR per suite Purchase priceas asatat31 December: €1,339 31December: €20.0m Occupancy Passing

  46. Slide 46: Bessboro

    BESSBORO Bessboro, Terenure, Dublin 6 Property details(1) Year Built: 2008/20092008 Suites: # of apartments owned: 63 40 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 40 AMR per suite Purchase priceas asatat31 December: €1,339 31December: €12.2m Occupancy Passing rentasasa

  47. Slide 47: Tallaght Cross West

    TALLAGHT CROSS WEST Tallaght Cross West, Tallaght, Dublin 24 Property details(1) Year Built: 2008/20092008 Suites: # of apartments owned: 63 442 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 507 AMR per suite Purchase priceas asatat31 15December: January: €1,339 €83.0m Occ

  48. Slide 48: Forum

    FORUM Forum, Sandyford, Dublin 18 Property details(1) Year Built: 2008/20092007 Suites: # of apartments owned: 63 8 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 127 AMR per suite Purchase priceas asatat31 17December: February: €1,339 €2.3m Occupancy Passing rentasasatat31

  49. Slide 49: City Square

    CITY SQUARE City Square, Gloucester Street, Dublin 2 Property details(1) Year Built: 2008/20092006 Suites: # of apartments owned: 63 23 Passing Total # ofrent apartments: as at 31 December: €1.0m (annualized) 27 AMR per suite Purchase priceas asatat31 7 April: December: €1,339 €5.9m Occupancy Passin

  50. Slide 50: Appendices

    APPENDICES Grande Central | Rockbrook, Sandyford, Dublin 1 50

  51. Slide 51: Experienced and Knowledgeable Leadership Team

    Experienced and Knowledgeable Leadership Team David Ehrlich – I•RES CEO  Senior partner of Stikeman Elliott LLP for over ten years until 31 December 2013  Focused his practice since 1986 on the public real estate markets and was involved in creating the REIT industry in Canada, including the forma

  52. Slide 52: Strong Majority Independent Board

    STRONG MAJORITY INDEPENDENT BOARD Colm O’Nualláin – Independent Non-Executive Chairman  Over 20 years of experience as Finance Director of Grafton Group Plc, a leading builders merchant group quoted on the London Stock Exchange  Qualified Chartered Accountant with international experience previous

  53. Slide 53: Management Arrangements Summary

    MANAGEMENT ARRANGEMENTS SUMMARY  IRES Fund Management Limited (“IRES Fund”), an indirect wholly owned subsidiary of CAPREIT, became authorised as an AIFM on 28 October 2015.  As disclosed in the Company’s recent prospectuses, the investment management agreement between the Company and IRES Fund (t

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