Slide 1: Great Things Happen When You Own Great Real Estate
Great Things Happen When You Own Great Real Estate Investor Presentation – March 28, 2018 G City, Rishon Lezion, Israel
Slide 2: Disclaimer
Disclaimer This presentation may include forward-looking statements, including forecasts, evaluations, pro forma figures, estimates and other information relating to future events and issues. Forward-looking statements may relate to, among other things, revenues, earnings, cash flows, capital expend
Slide 3: Who are we? Global Presence
Global Presence (1) Who are we? Global real estate company focused on the ownership, management, and development of high-quality, Brazil 8% Nordics irreplaceable, necessity driven retail and mixed use Israel 17% properties in major urban markets 12% Experienced and highly aligned management team wit
Slide 4: Our Global Investments and Business Plan
Our Global Investments and Business Plan Private Investments Mid Stage Public Mature Investments Investments Growing the “Private Collection” High Quality “Institutional Create Additional Grade” Portfolios Value USD 860m USD 935m USD 1.2b USD 1.3b USD 1.3b USD 827m (NIS 3b)(2) (NIS 3.4b) (NIS 4.2b)
Slide 5: Focus on Major Cities Across the Globe in Densely Populated Urban Areas
Focus on Major Cities Across the Globe in Densely Populated Urban Areas 69% of Gazit’s Asset Value is Concentrated In 14 Major Cities* Stockholm, Helsinki, Oslo, Tallin, Tampere & Copenhagen US MSA: New 27Assets CEE MSA: Warsaw, Prague, York, Miami & 29% Wroclaw Boston 3 Assets 13% 6 Assets 2% 11% T
Slide 6: Portfolio Quality Weighted Average Cap Rate
Portfolio Quality Weighted Average Cap Rate 6.3% Nordics Central Eastern Europe North America 5.4% 7.5% 5.3% 6.9% Israel Sao Paulo 7.9% Excluding Russia- 5.9% 6 Weighted average cap rate based on Gazit-Globe proportionate NOI in group’s subsidiaries excluding Regency Centers
Slide 7: The "Private Collection"
The “Private Collection” Business Strategy: Create value in our privately owned urban, irreplaceable, necessity driven retail and mixed use properties Long-term oriented investor in income producing assets in dense urban locations with high barriers to entry and significant upside potential. Identif
Slide 8: Gazit Horizons, North America – Business Overview
Gazit Horizons, North America – Business Overview Business Strategy Established Gazit Horizons as a wholly owned subsidiary in June 2017, with the goal of investing $3-$5 billion over the next 5 years* Gazit Horizons intends to acquire and redevelop large assets in irreplaceable locations, focusing
Slide 9: Recent – Gazit Horizons
Recent – Gazit 401 East 60th, Manhattan , New York First Acquisition of Gazit Horizons in New York Market Horizons In October 2017, Gazit Horizons acquired its first asset in the New York market, a three-level, 92,000-square-foot retail condominium on Manhattan’s upper east side, for $73.25 million.
Slide 10: Gazit Brasil – Business Overview
Gazit Brasil – Business Overview Business Strategy 6 Asset Map Gazit Brasil is an urban location-driven retail owner, 1 Cidade Jardim 2 Morumbi Town 3 Top Center 4 Shopping Light 5 Eldorado 6 Mais Shopping manager, operator and developer in Sao Paulo, the business 192 tenants 169 tenants 122 tenants
Slide 11: Top Center Case Study
Top Center Before After Case Study Value Creation Through Proactive Management 2014 2015 2016 2017 Acquisition and Re-tenanting Acquisition of the Revamping the submission of 95% of the mix, office tower and lobby and signing plans to bringing in parking garage with Decathlon municipality internatio
Slide 12: Latest Acquisition – Internacional Shopping
Current Latest Acquisition – Dutra Highway – 850,000 cars per day Internacional Shopping Pedestrian access and bus terminal Guarulhos, Sao Paulo metropolitan area Holding Rate – Gazit Brasil 70% Acquisition Price (70%) BRL 937m (USD 281m) Vehicle Access GLA (sqm) 77,000 (828,000 sqf) Dutra Highway L
Slide 13: Extra Itaim – Case Study
Extra Itaim - Sao Paulo, Brazil Extra Itaim – Case Study Generating Attractive Risk Adjusted Returns on Irreplaceable Assets Unleveraged IRR 25% during a weighted average holding period of 3.5 years Gazit Brasil acquired its first 17.5% stake in 2010. Between 2013 to 2017, Gazit Brasil proactively i
Slide 14: Gazit Israel – Business Overview
Gazit Israel – Business Overview Business Strategy Asset Map Wholly owned subsidiary of Gazit Globe, Gazit Israel is a leading Israel: Operating Assets owner-operator and developer of urban, grocery-anchored, leisure and entertainment shopping centers focused on the high-density Tel Aviv metropoli
Slide 15: G City, Rishon Lezion – Case Study
G City, Rishon Lezion – Case Study Creating Value • G City is privately-held, unique and dominant shopping center spanning ~1 km of frontage Through with 80,000 sqm of land (-19.7 acres) on a major thoroughfare. • The strip is strategically located with high visibility and accessibility to main traf
Slide 16: Israel – Active Development Projects
Israel – Active Development Projects G City (development expansion) G Kochav Hazafon 6 1 Gazit’s Ownership 100% Gazit’s Leasehold 100% 13,265 (142,700 2,200 (23,700 Built GLA (sqm) Expected GLA (sqm) sqf) sqf) Expected opening Q4/19 Closing Q1/18 Budget (million NIS) 157.5 Expected opening Q1/20 Amo
Slide 17: Israel – Future Development Pipeline
Israel – Future Development Pipeline G City (additional rights) G Kfar Saba (additional rights) 6 1 Additional building rights ~51,000 sqm (549,000 sqf) Additional building rights* ~32,000 sqm (344,000 sqf) Part of G City, privately held 80,000 sqm (19.7 acre) property The company is in the proc
Slide 18: Mid Stage Investments
Mid Stage Investments 18 Palac Pardubice, Pardubice, Czech
Slide 19: Central & Eastern Europe – Business Overview
Central & Eastern Europe – Business Overview Business Strategy Portfolio Metrics Asset Map Total Assets (€b) 3.1b Leading owner-operator and developer of food anchored Number of Assets 40(1) Russia shopping centres GLA (m sqm) 1.1 7 Opportunistic growth Net LTV 30.1% prospects offered by emergin
Slide 20: Northern Europe/Nordics – Business Overview
Northern Europe/Nordics – Business Overview Business Strategy Portfolio Metrics Asset Map Total Assets (€b) 4.68b Leading owner-operator and Number of Assets developer of urban, Number of Assets (1) 47 grocery-anchored shopping GLA (m sqm) (1) 1.18 centres in the Nordic and Net LTV 46.7% Sweden Ba
Slide 21: Mid Stage Investments – Citycon & Atrium
Mid Stage Investments – Citycon & Atrium • Focus on high density urban markets • Recycling capital and enhancing portfolio quality through divestment of non-core assets, selective acquisitions and investment in major redevelopment/expansions 2014 2017 104 60 56 43 27,000 16 ,000 Num of Assets* Avg.
Slide 22: Mature Investments
Mature Investments 22 Boulder Colorado
Slide 23: Mature Investments – Regency Centers & First Capital
Yorkville Village, Toronto First Capital Realty (TSX: FCR) Mature Acquired by Gazit Globe in 2000. Investments – Today FCR is one of Canada’s largest owners, Regency Centers developers and operators of grocery anchored, retail-focused properties, in urban markets with high barriers to entry. & First
Slide 24: Generating IRR's Over Long Term Investments
Generating IRR’s Over Long Term Investments Equity One – 21% Leveraged IRR* $ 4.46 B $ 1.2 B $ 0.09 B 1992 1998 2003 2017 Founded by Equity One lists Equity One acquires Successful Gazit on the NYSE IRT adding 92 income- Merger with producing properties Regency Centers to its portfolio Gazit Globe’s
Slide 25: Investment Opportunity
Investment Opportunity Rare opportunity to invest in a global, high-quality urban retail portfolio at a meaningful discount to NAV with a solid 4.5% dividend yield* Clear strategy to narrow NAV discount and drive superior risk-adjusted returns A strong and aligned management team with decades of pro
Slide 26: Financials
Arkady Pankrac, Prague, Czech Financials 26
Slide 27: Investment-grade credit rating group wide
Investment – grade credit rating group wide Agency Credit Rating S&P Maalot (Local Rating) ilAA- | Stable Midroog (Moody’s affiliate) Aa3il | Stable (Local Rating) S&P BBB | Negative Moody’s Baa1 | Negative S&P BBB- | Stable Fitch BBB- | Positive Moody’s Baa1 | Stable S&P BBB+ | Stable DBRS BBB (Hig
Slide 28: Focus on Urban, High-Density Assets in Stable and Growing Markets
Focus on Urban, High- Density Assets in Stable and Growing Markets Country Snapshot and NOI Diversification S&P % of GDP Country Rating NOI(1) Growth Canada AAA 21.4% 2.2% Norway AAA 7.1% 2.2% Sweden AAA 5.2% 2.6% Liljeholmstorget, AA+ and Above Stockholm, Sweden Germany AAA 0.7% 2.4% U.S. Other Inv
Slide 29: 2017 - Main Results
2017-Main Results Economic FFO p/s(1) – Increase of 19% LTV (expanded solo) - Decrease of 8.6% Shareholder’s Equity – Increase of 22% Economic FFO w/o fx rates impact - Increase of 28% NIS in millions NIS 9,936 62.0% 8,158 53.4% 31/12/2016 31/12/2017 31/12/2016 31/12/2017 3.58 G&A – HQ decrease of 2
Slide 30: Well Staggered Debt Maturity Schedule
Well Staggered Debt Maturity Schedule Debenture Maturity Schedule (expanded solo) as of 31.12.2017 NIS in Millions 14.2% 3,000.0 12.2% 14.0% 2,500.0 11.1% 11.3% 12.0% 10.5% 2,000.0 9.8% 8.9% 9.4% 10.0% 1,511 8.2% 1,500.0 1,296 1,200 1,179 1,117 8.0% 996 1,049 944 1,000.0 870 4.6% 489 6.0% 500.0 4.0%
Slide 31: High Liquidity = Financial Flexibility
High Liquidity=Financial Flexibility Access to Global Sources High Liquidity (1) US$ in Billions NIS in Billions US$ 1.5 NIS 7.8 US$ 1.3 Consolidated 3.8 Subsidiaries 44% 61% The Company and its 4.0 Private Subsidiaries 56% 39% 31/12/2017 31/12/2016 31/12/2017 International Banks Local Banks 31 (1)
Slide 32: Equity book value vs. market value and implied cap
Equity book value vs. market value and implied cap Holdings (Shares Holding Book value Market Value in millions, Rate (%) (December 2017) (March 28, 2018) December 2017) 18.5 10.9 4,432 3,818 Share Price (March 28, 2018) 33.99 79.6 32.6 4,643 4,377 Number of shares (millions) 193.46 396.9 44.6 4,078
Slide 33: Attractive valuation – FFO multiple of 10.1X, implied cap of 6.89%
Attractive valuation – FFO multiple of 10.1X, implied cap of 6.89% FFO Multiple Implied Cap Rate 10.0% 30x 9.0% 25x 8.0% 7.28% 7.55% 7.42% 7.30% 7.19% 7.06% 7.10% 7.10% 7.09% 7.00% 6.96% 6.89% 6.84% 6.75% 7.0% 6.58% 6.52% 18.9x 20x 6.0% 16.7x 15.8x 14.2x 15.2x 14.6x 14.0x 14.1x 5.0% 13.8x 13.7x 15x
Slide 34: Appendix
G Kfar Saba Kfar Saba, Israel Appendix 34
Slide 35: Evolution of Gazit Globe
Evolution of Gazit Globe Equity One Gazit-Globe acquires IRT Establishes a Expands into Acquires Gazit-Globe Successful Equity One is Gazit-Globe adding 92 presence in CEE through the Norway’s Sektor Launches U.S. Equity One lists divestment of founded in the enters into income- Brazil through acqui
Slide 36: Management
Management CHAIM KATZMAN ADI JEMINI RAMI VAISENBERGER ZVI GORDON Founder & CEO EVP and CFO VP & Controller VP of Investments Chaim Katzman is the Founder, Chief Chief Financial Officer since Jan. 2016 Financial Controller, since July 2004 Zvi Gordon has been Vice President Executive Officer and cont
Slide 37: International and Independent Board
International and Independent Board Ehud Arnon, Chairman of the Board of Directors, was until recently the President and CEO of Israel Discount Bank of New York, where he led the bank to enhanced profitability and many new business ventures which included finance of the the not for profit sector and
Slide 38: Thank you
Thank you Contact Information Adi Jemini EVP & CFO +972.3.6948000 Doron Lavi Segelson Head of Investor Relations dlavi@gazitgroup.com +972.3.6948037 38 G Tel Baruch , Tel Aviv, Israel