British Land Company PLC · LSE:BLND
British Land — The British Land Company — Investor Presentation (March 2013)
22 slides from British Land's investor presentation, Mar 12, 2013
Slide 1: Investor Presentation
Strictly Private & Confidential INVESTOR PRESENTATION 12 MARCH 2013 www.britishland.com
Slide 2: Disclaimer
Disclaimer This presentation has been prepared solely for preliminary discussions in relation to The British Land Company plc (“British Land”, or the “Company”) which are due to take place at proposed meetings in March 2013. For the purpose of this notice, “presentation” means this document, any ora
Slide 3: Disclaimer
Disclaimer To the extent available, the industry and market data contained in this presentation has come from official or third party sources. Third party industry publications, studies and surveys generally state that the data contained therein have been obtained from sources believed to be reliabl
Slide 4: Disclaimer
Disclaimer This presentation includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the terms “may”, "believes", "estimate
Slide 5: Introduction
Introduction • Proposed placing to raise c. £500m for attractive investment opportunities – £213m exchanged in last 3 months and growing pipeline – Expected to be accretive to EPS within next 12 months1 • Ropemaker sold for £472m (NIY 5.0%2), completing busy year of recycling – Proceeds reinvested i
Slide 6: Successful Investment Track Record
Successful Investment Track Record 2012/13 - Significant Investment Activity Successful Investment Track Record Over Last Three Years • £1.5bn of total activity (investments and sales) Unlevered IRR5 : 9% Unlevered IRR6 : 30% • Further upside from asset • Contributed £220m7 • Sales at average NIY of
Slide 7: Strong Investment Momentum
Strong Investment Momentum Development-led Asset management-led CLARGES ESTATE HEREFORD THE HEMPEL EALING BROADWAY • £130m acquisition • £90m phased acquisition • Potential £125m combined • £143m income-producing • 0.84 acre freehold site residential development retail-led mixed scheme • 310,000 sq
Slide 8: Proposed Use of Placing and Ropemaker Proceeds
Proposed Use of Placing and Ropemaker Proceeds Balanced Committed development spend Additional investment capacity recycling funded by Ropemaker provided by placing Active screening • Acquisitions in active screening • Further £250m of potential development spend ~£500m Identified acquisitions FY13
Slide 9: Increased Flow of Attractive Acquisition Opportunities
Increased Flow of Attractive Acquisition Opportunities Structural shifts driving • Institutions reconfiguring property holdings availability • Smaller players exiting UK real estate • Increasing realism from vendors on values London and retail • Core sectors; mix of income and development opportunit
Slide 10: Rigorous Approach to New Investment
Rigorous Approach to New Investment • Range of lot sizes, including portfolio deals Active screening • Accretive to portfolio returns • High single-digit unlevered IRRs on standing investments; low double-digit unlevered IRRs on developments Identified development • Identified but uncommitted develo
Slide 11: Ropemaker Disposal
Ropemaker Disposal • Sale of Ropemaker to AXA-led consortium – £472m gross sale price – 5.0% topped-up NIY2 – Net proceeds 1.4% above September 2012 book value • In line with strategy of recycling capital and balancing our portfolio between the West End and City – Taking advantage of strong internat
Slide 12: Financial Impact of Placing
Financial Impact of Placing • Placing provides additional investment LTV EPS12 capacity while remaining within long-term Post Ropemaker sale 44% LTV range Placing (4%) (2p) Completed acquisitions 1% 1p • Confident in earnings accretion by end FY Pro-forma 41% (1p) 2014 on annualised basis (post Rope
Slide 13: Supplementary Slides
#r, British Land SUPPLEMENTARY SLIDES
Slide 14: Presentation Footnotes
Presentation Footnotes The following footnotes apply to the previous slides: 1. On an annualised basis, pro-forma for Ropemaker disposal 2. Topped-up for rent frees 3. Three years to Sep 2012 with acquisition costs spread over a five year hold period on standing investments 4. Based on Sep 2012 exte
Slide 15: Proposed Placing
Proposed Placing • Proposed placing of up to 89,674,604 New Ordinary Shares to raise c. £500m • Representing c.9.99% of the Company's issued share capital prior to the placing • Placing price to be determined through an accelerated bookbuild • To be launched on or around 12 March 2013 15
Slide 16: Acquisitions and Disposals in Current Financial Year
Acquisitions and Disposals in Current Financial Year Acquisitions Sector Price BL Share BL Share NIY2 (100%) £m £m Rent £m Wereldhave portfolio Retail 180 180 12 6.5 Clarges Estate Mixed use 130 130 - n/a Hereford1 Retail 90 90 - n/a Eden Walk Shopping Centre, Kingston (50%) Retail 83 42 3 5.4 The H
Slide 17: Committed Development Projects
Committed Development Projects PC Current Cost to Notional Resi End BL Share Sq ft Calendar Value complete interest ERV Pre-let Value 1 1,2 At September 2012 % '000 Year £m £m £m £m3 £m £m4 5 Broadgate 50 700 Q4 2014 139 123 22 19.2 19.2 - The Leadenhall Building 50 610 Q2 2014 121 104 17 18.6 5.6 -
Slide 18: Estimated Future Development Rental Income
Estimated Future Development Rental Income (Accounting Basis) PC Gross rental income (Accounting basis)3 £m – 12 mths As at 30 September 2012 Calendar Year Mar 14 Mar 15 Mar 16 Mar 17 5 Broadgate Q4 2014 Contracted - 6 17 17 The Leadenhall Building Q2 2014 Contracted - 4 5 5 Non-contracted - - 8 11
Slide 19: Delivering Superior Performance
Delivering Superior Performance • Significant outperformance vs IPD, +12.7% since March 2009 (+2.8% pa) • High level of pass through of income as dividends; most cost efficient of the UK major REITs 2010 2011 2012 HY Sept 2012 Total Accounting Return 33.5% 17.7% 9.5% 2.4% Total Property Return 21.5%
Slide 20: Performance Underpinned by Strong Operational Metrics
Performance Underpinned by Strong Operational Metrics • Quality portfolio; benefiting from polarisation • Occupancy maintained at high levels ERV growth 2011 2012 HY Sept 2012 Retail 0.7% 1.4% 0.0% Offices 7.7% 3.7% 1.0% Total 2.7% 2.1% 0.3% ERV growth vs IPD +260bps +160bps +40bps 20
Slide 21: Strong Financial Position
Strong Financial Position Proportionally Consolidated 31 March 2012 30 Sept 2012 EPRA Net Debt £m 4,690 4,788 Loan to Value (LTV) 45.3% 46.0% Average Interest Rate 4.6% 4.4% Interest Cover 2.2x 2.3x Average maturity of drawn debt (years) 9.3 9.4 Group Loan to Value (LTV) 29.1% 31.5% Average Interest
Slide 22: Diversified Sources and Well Spread Debt Maturities
Diversified Sources and Well Spread Debt Maturities • Prior to receipt of proceeds from Ropemaker and the Placing, £1bn of revolving facilities are currently drawn Group Debt Maturity as at September 2012 £m Year to 30 September 22
The British Land Company — Investor Presentation (March 2013) on 6ix