Centuria Capital Group · ASX:CNI
Centuria Capital — 360 Capital Office Fund — HY15 Earnings Presentation
26 slides from Centuria Capital's earnings presentation, Feb 18, 2015
Slide 1: 2015 Half Year Financial Results Presentation
360 CAPITAL OFFICE FUND ARSN 106 453 196 2015 Half Year Financial Results Presentation | 18 February 2015
Slide 2: Table of contents
Table of contents Section Page Appendices Page HY15 highlights 3 Balance sheet 17 Key achievements 4 Profit and loss 18 Results overview 5 Operating earnings reconciliation 19 Property portfolio 6 Target market overviews 20 Acquisitions and disposals 10 Property portfolio details 23 Capital manageme
Slide 3: HY15 highlights
HY15 highlights P Reinvestment of Burwood sale proceeds in $46.50m acquisition of Botanicca 8, Richmond, Victoria1 P Post period New 10 year lease over 1,396sqm of rental guarantee space at Kingsford Smith Drive P Interest costs reduced by 50bp to 4.1% & Interest rate hedge fixed for five years post
Slide 4: Key achievements
Key achievements • 100.0%1 occupancy Underlying • 4.7 year2 WALE portfolio driving • No expiries until Dec-15 results • Strong income security with 72.0 % of portfolio income generated from Government and publicly listed tenants • Closing price as at 31 Dec 14 of $2.06 per unit equates to: Attractiv
Slide 5: Results overview
Results overview • Recapitalisation & ASX listing transformed the Fund HY15 pcp1 • Statutory and Operating EPU distorted by Statutory net profit ($’000) 3,652 4,603 recapitalisation and one-off items Statutory EPU (cents) 2 4.7 2,313.5 • Forecast FY15 DPU in line with guidance Operating earnings3 ($
Slide 6: Property portfolio (post Botanicca acquisition)
Property portfolio (post Botanicca acquisition) Botanicca 8, another high quality A-grade suburban asset (settled post period) Number of assets 4 Portfolio value ($m) 220.0 Net lettable area (sqm) 38,825 WACR (%) 8.25 Weighted average initial yield (%) 9.0 Occupancy1 (%) 100.0 Fixed & CPI rent revie
Slide 7: Property portfolio (post Botanicca acquisition)
Property portfolio (post Botanicca acquisition) Top 10 tenants as at 31 Dec 142 • Diversified, quality tenant based Income Total • 72% made up of government and publicly Company ($m). (%) listed tenants Commonwealth of Australia1 4.8 23.6% • 100.0% portfolio occupancy with a 4.7 year WALE GE Capital
Slide 8: Property portfolio: Leasing update - Allara Street
Property portfolio Leasing update - 33 Allara Street Status • Economic benefits remain for the Department of Environment to “stay-put” • Time limited in finding alternate premises • Political environment hindering decision making Market fundamentals • Increase in A-Grade Vacancy with completion of s
Slide 9: Leasing update – Kingsford Smith Drive, Hamilton Harbour, QLD
Property portfolio Leasing update – 483 Kingsford Smith Drive, Hamilton Harbour, QLD Update: Leased 1,396sqm to Collins Foods for 10 years (post period) Increases WALE from 8.0 to 8.9 years Reduces rental guarantee from 23% to 10% of gross income Actively marketing the remaining retail tenan
Slide 10: Acquisition Summary – Botanicca 8, Richmond, VIC
Acquisitions and disposals Acquisition Summary – Botanicca 8, Richmond, VIC Summary Metrics NLA (sqm) 8,331 Age (years) 2 Net passing income ($m p.a.) 3.6 Initial yield (%) 7.7 WALE (years)1 7.2 Occupancy (%) 100.0 Car parking bays 212 NABERS rating2 4.5 Star Five level office building with ground
Slide 11: Acquisition Summary – Botanicca 8 lease expiry and tenants
Acquisitions and disposals Acquisition Summary – Botanicca 8, Richmond, VIC Lease expiry profile – by gross passing rental Tenancy composition – by gross rental Retail 100.0% 4% 100% 80% 60% Forever new Clothing 40% 38% GE Capital Finance 20% 58% 0.0% 0.0% 0.0% 0.0% 0% Vacant FY15 FY16 FY17 FY18+ Op
Slide 12: Continued focus on acquiring A-grade suburban assets
Acquisitions and disposals Continued focus on acquiring A-grade suburban assets April 2014 October 2014 December 2014 Portfolio at ASX listing Non-core disposal: Burwood Core acquisition: Portfolio now: $15.0m above Book Value Botanicca 8 3 Secure Income Focus Value: $235.0 Price: $80.0m Price: $46.
Slide 13: Capital management
Capital management Debt • Low interest rate environment not permanent Interest Cost Hedge Term • Post reporting period: Previous New Previous New • hedge rate reduced in line with drawn debt and extended to five years • facility limit reduced to $80.0m taking 4.6% 4.1% 2.3yrs 5.0yrs advantage of low
Slide 14: Strategy
Strategy Provide consistent and growing income returns and capital growth from a diverse portfolio of office assets owned within a simple capital structure Acquisitions, disposals and portfolio Capital management Philosophy management • Continue disciplined approach to • Recognise low interest rate
Slide 15: Outlook
Outlook Market • Leasing markets have stabilised, however tenant demand remains subdued in CBDs • Limited new supply combined with stock withdrawals Provide should consistent and benefit growing suburban markets income • Demand for institutional grade office property returns investments and capital
Slide 16: Appendices
Provide consistent and growing income returns and capital growth from a diverse portfolio of office assets owned within a simple capital structure Philosophy Appendices 16
Slide 17: Balance Sheet
Balance Sheet 31-Dec-14 30-Jun-14 Balance Sheet1 ($'000) ($'000) Assets Cash and cash equivalents Provide consistent and growing income 2,935 4,928 Trade and other receivables returns and capital growth from a diverse 2,991 473 Investment properties held for sale portfolio of office assets owned wit
Slide 18: Profit & Loss
Profit & Loss 31-Dec-14 31-Dec-13 Operating Profit & Loss Statement1 ($'000) ($'000) Rental income2 10,906 5,635 Finance Revenue Provide consistent and growing income 72 35 returns and capital growth from a diverse Total Income 10,978 5,670 portfolio of office assets owned within a Investment Proper
Slide 19: Operating earnings reconciliation
Operating earnings reconciliation 31-Dec-14 31-Dec-13 Operating earnings reconciliation ($'000) ($'000) Statutory net profit 3,652 4,603 Provide consistent and growing income Net loss/(gain) on fair value of investment properties 741 (4,502) returns and capital growth from a diverse Net fair value g
Slide 20: Target market overview: Brisbane Fringe
Target market overview Brisbane Fringe Size: Total market size: 1,204,451sqm; A grade market size: 619,933sqm Vacancy: Current Market Vacancy: 12.8%; A grade Vacancy: 12.1% In the second half of 2014, A grade vacancy in the Brisbane Fringe was 12.1%, up 260 bps from Jul-14. The vacancy rate edged up
Slide 21: Target market overview: Canberra CBD
Target market overview Canberra CBD Size: Total market size: 2,393,674sqm; A grade market size: 1,075,236sqm (Civic total market size: 687,950sqm; Civic A grade: 299,888) Vacancy: Current Market Vacancy: 15.4%; A grade Vacancy 15.7% (Civic Market Vacancy: 14.7%; Civic A grade Vacancy: 11.1%) In the
Slide 22: Target market overview: East Melbourne Fringe
Target market overview East Melbourne Fringe Size: Total market size: 176,361sqm; A grade market size: 61,352sqm Vacancy: Current Market Vacancy: 1.4%; A grade Vacancy 1.1% In the second half of 2014 Grade A Market vacancy in East Melbourne was 1.1%, down 150 bps from Jul-14. The vacancy rate decrea
Slide 23: Property portfolio details
Property portfolio details 154 Melbourne Street, South Brisbane, QLD 485 Kingsford Smith Drive, Hamilton, QLD 574 Swan Street, Melbourne, VIC Provide consistent and growing income returns and capital growth from a diverse portfolio of office assets owned within a simple capital structure The propert
Slide 24: Property portfolio details: Allara Street, Canberra
Property portfolio details 33 Allara Street, Canberra, ACT Provide consistent and growing income returns and capital growth from a diverse portfolio of office assets owned within a simple capital structure The property comprises an eight level commercial building constructed in 1987 and refurbished
Slide 25: Property portfolio summary
Property portfolio summary Ownership Cap. Initial NABERS Valuation Valuation NLA Occupancy WALE Property interest State Rate yield rating ($m) date (sqm) (%) (years) (%) (%) (%) (Star) 154 Melbourne St, 100.0 QLD 75.0 Jun 14 8.00 11,277 8.20 100.0 3.3 5.0 South Brisbane 438-517 Kingsford 100.0 QLD 6
Slide 26: Disclaimer
Disclaimer This presentation has been prepared by 360 Capital Investment Management Limited (ACN 133 363 185, AFSL 340304) as responsible entity of the 360 Capital Office Fund (ARSN 106 453 196) (‘TOF’ or the ‘Fund’) . All information and statistics in this presentation are current as at 18 February