Grainger Plc · LSE:GRI
Grainger — Investor Day (September 2020)
35 slides from Grainger's investor day presentation, Sep 29, 2020
Slide 1: Building Homes & Communities for the future
Building Homes & Communities for the future 2020 Investor Update 29 September 2020
Slide 2: Agenda
Agenda Originate Invest Operate 1. Introduction Helen Gordon Chief Executive 2. Trading Update Vanessa Simms Chief Financial Officer 3. Focus on Health & Wellbeing Helen Gordon Chief Executive 4. Urbanisation Trends Thomas Grounds Head of Research 5. Product Resilience Robin Keates Director of Forwa
Slide 3: Pontoon Dock
Pontoon Dock Originate Invest Operate Grainger Plc | www.graingerplc.co.uk 3
Slide 4: Pontoon Dock
Pontoon Dock Originate Invest Operate Grainger Plc | www.graingerplc.co.uk 4
Slide 5: Homes have never been so important
Homes have never been so Originate Invest Operate important Grainger Plc | www.graingerplc.co.uk 5
Slide 6: Our Values
Our Values Originate Invest Operate Renting homes, enriching lives Every home People at Leading Exceeding matters the heart The way expectations Grainger Plc | www.graingerplc.co.uk 6
Slide 7: Our approach
Our approach Originate Invest Operate Maintaining business continuity and strategic momentum Innovating to maintain business as usual and continue to serve our Innovate customers. • Virtual viewings • Remote working • Direct customer sales • Sales process re- engineered Continual communication with
Slide 8: A strong pipeline for growth
A strong pipeline for growth Originate Invest Operate £1,085m secured pipeline HY20 OPERATIONAL PORTFOLIO PIPELINE 9,270 homes, £2.8bn 8,536 homes, £2.0bn £312m c.£600m £1,090m £1,683m £1,085m Planning/ TfL* Regulated tenancies PRS* Secured pipeline Legals c.3,000 3,225 homes 6,045 homes 4,311 homes
Slide 9: 2. Performance Update
2. Performance Update Vanessa Simms Chief Financial Officer * Company financial information covers the 11 months to the end of August 2020 unless otherwise stated
Slide 10: Strong performance & well positioned for future growth
Strong performance & well positioned for Originate Invest Operate future growth Strong rental and sales performance, underpinned by a strong balance sheet Rental income Sales profits inline Strong balance sheet remains strong and liquidity Profits in line with prior years Significant financing activ
Slide 11: Rental income resilience continues
Rental income resilience continues Originate Invest Operate Cash collections, rental growth and arrears have all remained strong Rent Collection Rental Growth Rent collection inline with prior year levels Strong rental growth at 3.0% In-house operations vital to strong ‒ PRS rental growth at 2.5% pe
Slide 12: Passing net rent progression
Passing net rent progression Originate Invest Operate Revised NRI growth projections Timing of rental income shifts slightly as a result of lockdown related construction delays Planning / legals Secured pipeline: £1,085m TfL: £600m* £312m +2.3x +£24m £172m +£16m +£22m £132m +1.8x +£16m +£13m +£7m £7
Slide 13: 3. Focus on Health & Wellbeing
3. Focus on Health & Wellbeing Helen Gordon Chief Executive
Slide 14: Health and Wellbeing
Health and Wellbeing Originate Invest Operate We don’t build houses, we build homes and communities Happy residents stay longer Experience of residents needs informs design Wellbeing is integral to our design philosophy Wellbeing is becoming increasingly important Grainger Plc | www.graingerplc.co.u
Slide 15: Access to the outdoors
Access to the outdoors Originate Invest Operate Our resident amenity spaces serve as an extension to residents homes. They provide places to relax, entertain, work and socialise, both inside and out. Recent launches all provide multiple and extensive outdoor terraces to enjoy. Many of our homes also
Slide 16: Health and fitness
Health and fitness Originate Invest Operate Gyms or fitness area’s are a core offering within our buildings, providing residents with convenience and additional opportunities to interact with others. Our shared spaces also work well as venues for wellness classes. In lockdown, as part of our Wellnes
Slide 17: Measuring wellbeing
Measuring wellbeing Originate Invest Operate Wellbeing is increasingly considered in our asset acquisition and recycling. We measure the WalkScore of our properties – how walkable a location is to local amenities. Our development pipeline has an average WalkScore of 89/100 or “Very Walkable.” Proper
Slide 18: Future spaces
Future spaces Originate Invest Operate All of our operational and pipeline Build to Rent developments have a co-working space available to residents. Our standard superfast WiFi offering, included within the rent, means that residents are up and running from day one. As working from home at least so
Slide 19: Urbanisation: a long-term trend
Urbanisation: a long-term trend Thomas Grounds Head of Research
Slide 20: Where Grainger invests
Where Grainger invests Originate Invest Operate We are long term investors targeting undersupplied areas with high rental demand Our capital allocation is driven by long run supply and demand which can be either a city centre or suburban location ‒ Typically the dynamics are most supportive in citie
Slide 21: Urbanisation: in it for the long haul
Urbanisation: in it for the long haul Originate Invest Operate Grainger is a long-established business taking a long-term approach to investment World population living in urban and rural areas Cities’ prosperity continues to draw in residents, worldwide 5 • By 2018, the world’s population had grown
Slide 22: Urban areas show higher productivity
Urban areas show higher productivity Originate Invest Operate Higher geographic concentrations of workers produce more per hour GVA per hour worked vs employment density, England, Local Authorities with workplace populations >100k, 2018 1,000,000 Bubble size refers to total employment volume 100,000
Slide 23: Cities have a strong culture advantage
Cities have a strong culture advantage Originate Invest Operate City centre residents prioritise accessibility to amenities, culture and public transport The main reason why respondents chose to live in their Research suggests that residents in cities prioritise access to neighbourhood – City Centre
Slide 24: Emigration from London is nothing new
Emigration from London is nothing new Originate Invest Operate London saw a significant outflow of domestic residents over the last decade, with growth driven by international migration and births Impact of Age on London's population - 2011 to 2019 70,000 Number of moves by age in London 60,000 Lond
Slide 25: City centres remain vital HQ locations
City centres remain vital HQ locations Originate Invest Operate The transport links of city centres enable recruitment of employees from wide catchment areas Commuting to City of London • Maps shows commuting flows from Census 2011. • Map reflective of number of commuters from each area travelling t
Slide 26: Cities can be drivers of sustainability
Cities can be drivers of sustainability Originate Invest Operate Denser populations with public transport access produce lower emissions Transport CO2 emissions per capita vs population density of cities 8 Houston 7 Transport emissions per capita(tCO₂) 6 Melbourne 5 4 Dubai Portland Chicago 3 San Fr
Slide 27: Conclusion
Conclusion Originate Invest Operate ▪ There is a lot of evidence supporting the idea of economies of agglomeration within large Economies of cities, notably the knowledge spillovers so vital to driving innovation agglomeration ▪ Although a more distributed method of working and networking, facilitat
Slide 28: 5. Product Resilience
5. Product Resilience Robin Keates Director of Forward Funded Delivery
Slide 29: "No place like home"
“No place like home” Originate Invest Operate In a post-Covid-19 environment, we can expect renters to be more conscious of the resilience of their home during uncertain times Temporary focus: Long-term behavioural effect: “I feel unsafe” “I want more certainty that my home will be liveable during d
Slide 30: A single point of contact
A single point of contact Originate Invest Operate “I want more certainty that my home will be liveable during difficult times and I want to know that my home is safe and secure”: Covid-19 has made tenants more conscious of the management and security of their living space Fully-integrated, seamless
Slide 31: A place for living
A place for living Originate Invest Operate “I want my home to fulfil my leisure and work requirements”: A home that is for more than just eating and sleeping Flexible, connected workspace Outdoor space Residents’ lounge In-house gyms Grainger Plc | www.graingerplc.co.uk 31
Slide 32: A thriving community
A thriving community Originate Invest Operate “I want to make sure I am connected”: Feeling part of a thriving, generous community has never felt more important Residents are able to partake in community events with their neighbours • Residents’ quiz • Virtual book clubs • Yoga classes held via Zoom
Slide 33: 21st century renting
21st century renting Originate Invest Operate Seamless provision of products and services that help tenants manage their busy, modern lives Grainger provides a rental experience fit for modern living Grainger Plc | www.graingerplc.co.uk 33
Slide 34: Summary
Summary Originate Invest Operate Strong track record Leader in the sector Resilient residential strategy Compelling long term return Strong operational model Pipeline for growth Research backed capital Investing in people allocation Grainger Plc | www.graingerplc.co.uk 34
Slide 35: Q&A
Q&A Originate Invest Operate Grainger Plc | www.graingerplc.co.uk 35