Growthpoint Properties Australia · ASX:GOZ
Growthpoint Properties Australia — Debt Investor Presentation (March 2017)
44 slides from Growthpoint Properties Australia's debt investor presentation, March 2017
Slide 1: Private Placement Investor Presentation
Growthpoint Properties Australia (ASX Code: GOZ) Growthpoint Properties Australia Trust ARSN 120 121 002 Growthpoint Properties Australia Limited ABN 33 124 093 901 AFSL 316409 www.growthpoint.com.au Private Placement Investor Presentation March 2017 15 Green Square Close, Fortitude Valley, QLD
Slide 2: Important information
Important information Disclaimer pro forma historical financial information included in this Presentation Forward-looking statements including projections, indications or This presentation and its appendices (“Presentation”) is dated March does not purport to be in compliance with Article 11 of Regu
Slide 3: Introduction
Introduction Dion Andrews, B.Bus, FCCA Chief Financial Officer, Company Secretary (appointed 8 May 2014) Dion is a Chartered Accountant and is responsible for the financial reporting obligations of the Group as well as debt structuring, raising debt capital and technology. Dion has over 15 years’ ex
Slide 4: Contents
Contents Overview Financial Overview Appendices Growthpoint Properties Australia – Five year performance summary 22 Appendix 1: Growthpoint Properties Overview 6 Limited - South Africa (GRT) 38 HY17 financial results 23 Portfolio Overview Appendix 2: Sydney Olympic Park 39 Operating and capital expe
Slide 5: Overview
Overview 109 Burwood Road, Hawthorn, VIC
Slide 6: Growthpoint Properties Australia: Overview
Growthpoint Properties Australia: The four pillars of our investment offering are: Overview 1 100% investment What is GOZ? GOZ’s history in Australia All of the Group’s properties are located in Australia where our GOZ is an ASX-listed landlord with a GOZ commenced in its current form in management
Slide 7: Portfolio overview: Geographic and sector diversity
Portfolio overview: Geographic diversity by property value as at 31 December 2016 Geographic and sector diversity1 VIC 29% 88% QLD 28% located on NSW 26% Australia’s SA 6% Eastern Seaboard ACT 5% Office properties WA 5% Industrial properties Brisbane, QLD TAS 1% Sector diversity $906.9m by property
Slide 8: Portfolio overview: Key metrics
Portfolio overview: Key metrics Top ten tenants Annual rent review type (%)* Net property income per State Portfolio lease expiry profile (%) by passing rent as at 31 December 2016 as at 31 December 2016 / Territory for HY17 ($m) per financial year, by income 52 WALE % (yrs) Woolworths 16 5.8 38.3 N
Slide 9: Top five office properties/ property groups by value
Top five office properties/ 56% $1,175.2m 7.0yrs 3.6% property groups by value of office portfolio total value of top five properties / property groups weighted average lease expiry weighted average rent review3 1 2 3 4 5 SW1 Complex, 1 Charles St, Parramatta, Sydney Olympic Park, NSW 75 Dorcas St,
Slide 10: Top five industrial properties/ property groups by value
Top five industrial properties/ 82% $897.9m 5.5yrs 2.6% property groups by value of industrial portfolio total value of top five properties / property groups weighted average lease expiry weighted average rent review1 1 2 3 4 5 Woolworths Distribution Linfox properties, Erskine Melbourne Airport Kno
Slide 11: Adding value through our transparent business model
Adding value HY17: $182m new equity capital 1 and $300m new debt capital through our HY17: Distributions of $68m paid to Securityholders, 10.6cps (HY16: $58.1m, 10.2cps). Raise Capital: raised (HY16: $40.1m and $250m). transparent Payout ratio of 84.9% (HY16: 95.2%). Raise equity capital from Securi
Slide 12: HY17 strategy implementation
HY17 strategy implementation Property portfolio enhanced Leases extended and portfolio by value and sector occupancy increased to 99% SOLD LEASED 55,126sqm GMF takeover Five industrial completed, adding properties sold for $440.3m $152.3m leasing completed during HY17 and six office properties in tw
Slide 13: HY17 strategy implementation (cont.)
HY17 strategy implementation (cont.) Increased exposure to NSW and office sector; lowered VIC industrial exposure NSW exposure Office sector Victoria industrial increased to exposure increased to exposure reduced to 26% 66% 13% from 20% from 56% from 20% at 30 June 2016 at 30 June 2016 at 30 June 20
Slide 14: GMF takeover
GMF takeover • Completed the takeover and full integration of GPT Metro Office Fund (GMF); book value A$454.2m as at 31 December 2016 • GMF comprises six A-grade office properties with a 5 year WALE • The takeover of GMF helped with several of Growthpoint’s previously stated objectives, including: –
Slide 15: GMF takeover (cont.)
GMF takeover (cont.) 1 2 3 4 5 6 GMF key statistics GMF property portfolio statistics (as at 31 December 2016) Book Cap Lettable Site State value rate WALE area area Major tenant —— A$454.2 million total A$m % years sqm sqm property value 1 15 Green Square Cl, Fortitude Valley QLD 129.8 6.50 5.2 16,
Slide 16: Leasing: completed since 30 June 2015
Leasing: completed since 30 June 2015 Leases completed in FY16 Term Annual rent NLA Car Address Sector Tenant Start date (yrs) increases (%) (sqm) Parks A1, 32 Cordelia St South Brisbane QLD Office Jacobs Group (Australia) Q4, FY15 11.4 Fixed 3.75 6,896 50 A1, 32 Cordelia St South Brisbane QLD Offic
Slide 17: Leasing: completed since 30 June 2015 (cont.)
Leasing: completed since 30 June 2015 (cont.) Leases completed in HY16 Term Annual rent NLA Car Address Sector Tenant Start date (yrs) increases (%) (sqm) Parks 333 Ann Street Brisbane QLD Office St Hilliers Property Q2, FY17 5.0 Fixed 3.75% 503 – 15 Green Square Close Fortitude Valley QLD Office Du
Slide 18: Acquisitions and disposals
Acquisitons and disposals Acquisitions: July 2015 to December 2016 Purchase Price Book Value Cap Rate WALE Property Suburb State Major Tenant Asset Class Date ($m) ($m) (%) (years) 1-3 Pope Court Beverley SA Aluminium Specialties Group Industrial Jul-15 20.8 21.5 7.75% 3.9 34 Reddalls Road Kembla Gr
Slide 19: Development and capital expenditure
Development and capital expenditure The proposed Growthpoint has an in-house capital projects capital improvement and development team to enhance its existing programme is investments. expected to result in increased Growthpoint has a potential pipeline of approximately rental revenue, $200 million
Slide 20: Sustainability
Sustainability 5 Murray Rose Avenue is the third office building in Australia to have been issued with a 6 star NABERS rating Average NABERS Average NABERS energy rating1 of water rating2 of 4.4 stars 4.9 stars up from 4.2 stars at up from 4.5 stars at 30 June 2016 30 June 2016 Other sustainability
Slide 21: Financial Overview
Financial Overview 27-49 Lenore Drive, Erskine Park, NSW
Slide 22: Five year performance summary
Five year performance summary HY17 FY161 FY154 FY14 FY13 FY12 Number of properties no. 59 58 53 51 44 42 Total value A$m 3,194.7 2,832.6 2,372.5 2,093.7 1,694.5 1,634.8 Occupancy % 99 99 97 98 98 99 Like-for-like value change A$m / % of asset value 59.6 / 2.2 130.2 / 5.5 186.0 / 9.0 52.1 / 3.0 30.6
Slide 23: HY17 Financial results
HY17 Financial results HY17 HY16 Change % Change Statutory accounting profit $'000 113,005 124,736 (11,731) (9.4) Statutory accounting profit per security ¢ 17.6 21.9 (4.3) (19.6) Distributable income $'000 80,105 61,024 19,081 31.3 Distributable income per security ¢ 12.5 10.7 1.8 16.8 Distribution
Slide 24: Operating and capital expenses
Operating and capital expenses Operating expenses CY16 CY15 Total operating expenses $’000 11,198 9,672 Average gross asset value $’000 2,881,697 2,363,764 Expected to remain around Operating expenses to average gross assets % 0.39 0.41 0.4% based on current portfolio Capital expenditure CY16 CY15 T
Slide 25: Equity Capital
Equity Capital Market capitalization and free float ($m) Growthpoint Location of Growthpoint Securityholders1 Securityholders1 Market capitalisation As at 31 December 2016 As at 31 December 2016 2,103.9 Free float 1,836.8 1,781.1 1,323.3 966.8 796.9 750.9 623.9 633.7 GRT 64.3% South Africa 73.0%2 In
Slide 26: Debt Management: Gearing
Debt Management: Gearing Summary of debt facilities Change in gearing and cost of debt (%) Balance sheet Secured Limit Drawn bank loans ($’000) ($’000) Maturity gearing 65% 8.0% Balance Sheet Gearing target range 60% 7.5% All-in cost of debt Syndicated Facility 35%-45% 55% 7.0% - Facility A 255,000
Slide 27: Debt Management: Interest rate hedging and fixed interest
Debt Management: Interest rate hedging and fixed interest • The weighted average hedging Weighted average fixed debt as at 31 December 2016 Targeting maturity of interest rate swaps at fixed/hedged Interest Rate Swaps (IRS) 31 December 2016 was 3.5 years Time to Fixed 75%-100% Maturity date maturity
Slide 28: Pro Forma capitalization
Pro Forma capitalization As at 31 December 2016 Adjustments Pro Forma A$m A$m A$m Cash and cash equivalents 37.8 - 37.8 Secured Bank Loans 1,383.1 (194.3) 1,188.8 US Private Placement1 - 194.3 194.3 Total debt 1,383.1 - 1,383.1 Total equity 1,744.2 - 1,744.2 1. Converted at an exchange rate of 1 USD
Slide 29: Market Outlook and Conclusion
Market Outlook and Conclusion 10-12 Mort Street, Canberra, ACT
Slide 30: State of key office markets
State of key office markets 3% of 14% of Growthpoint Brisbane - CBD Brisbane - Fringe Growthpoint Portfolio Portfolio Vacancy 15.3% Vacancy 12.6% Prime Secondary Prime Secondary R $700 gross $555 gross R $545 gross $440 gross R Average rent per sqm per annum I 37% 40% I 36% 38% I Indicative incentiv
Slide 31: State of key industrial markets
State of key industrial markets R Average rent per sqm per annum I Indicative incentives Y Average core market yield 8% of Brisbane Growthpoint Rents Rents Portfolio decreasing increasing Vacancy 8.9% / incentives / incentives increasing Stable decreasing Prime Secondary R $104 net $84 net I 10% 12%
Slide 32: Focus for the year ahead
Focus for the year ahead Property portfolio Financial management Strategy and performance • Seek further office investment • Consider reducing gearing towards middle • Consider M&A opportunities opportunities in Melbourne and Sydney; of target gearing range of 35%-45% • Seek to grow distributions by
Slide 33: Summary
Summary WWStable and predictable income WWAsset diversity WWHigh quality tenants and robust occupancy WWPrudent and diligent approach to acquisitions WWConservative financial policy WWStrong Securityholder support WWStrong Investment Grade Rating and stable outlook WWExperienced management 1231-1241
Slide 34: Transaction Overview
Transaction Overview 75 Dorcas Street, South Melbourne, VIC
Slide 35: Transaction Overview
Transaction Overview Issuer Growthpoint Properties Australia Limited as responsible entity of the Growthpoint Properties Australia Trust Credit rating Baa2 (Stable) from Moody’s Subsidiary Guarantors The Company’s obligations under the Notes will be guaranteed by certain of its subsidiaries pursuant
Slide 36: Transaction Timeline
Transaction Timeline Key Dates USPP Event March 6, 7 and 8 Investor Roadshow March 7 Management Conference Call @ 5:00pm EST / 4:00pm CST March 15 (2:00pm EST) Bids due March 16 Price Transaction April 3 (week of) Investor due diligence call (TBD) April 10 (or later) Closing June 2017 Funding Growth
Slide 37: Appendices
Appendices 1 Charles Street, Parramatta, NSW
Slide 38: Appendix 1: Growthpoint Properties Limited - South Africa (GRT)
Appendix 1: Growthpoint Properties Limited - South Africa (GRT) Growthpoint Properties Limited of South Africa (“GRT”) owns 64.3% Key Facts 30 June 2016 of the securities of Growthpoint (at 31 December 2016) and is its major Listing GRT is listed on the Securityholder. Johannesburg Stock Exchange (J
Slide 39: Appendix 2: Sydney Olympic Park, NSW
Appendix 2: Sydney Olympic Park, NSW Sydney Olympic Park Growthpoint’s Sydney Olympic highlights Park assets, key statistics (as at 31 December 2016) • Located 16 kilometres west of Sydney’s CBD, Sydney Olympic Park was —— $242.9 million total property value redeveloped for the 2000 Sydney —— 6.6% a
Slide 40: Appendix 3: Lease incentives
Appendix 3: Lease incentives Lease incentives for leasing completed in HY17 averaged 24% (26% office and 9% industrial). This includes fit-out, rent free, rental abatement and cash payments. Financial impact of incentives and leasing costs1 The impact of tenant incentives on Growthpoint’s HY17 finan
Slide 41: Appendix 4: Financial position
Appendix 4: Financial position as at 31 Dec 2016 as at 30 Jun 20161 $’000 $’000 Assets Cash and cash equivalents 37,795 70,661 Investment properties 3,184,420 2,651,145 Other assets 16,781 157,799 Total assets 3,238,996 2,879,605 Liabilities Borrowings 1,377,247 1,242,226 Distributions payable 67,99
Slide 42: Appendix 5: Board of Directors
Appendix 5: Board of Directors 1 2 1 Geoffrey Tomlinson (69) 5 Grant Jackson (50) Independent Chairman (since 1 July 2014) Independent Director (since 5 August 2009) and Director (since 1 September 2013) Assoc. Dip. Valuations, FAPI BEC Over 30 years’ experience in the property 44 years experience i
Slide 43: Glossary
Glossary 2HY17 the six months ending 30 June 2017 Growthpoint SA Growthpoint Properties Limited of South Africa (Growthpoint’s A-REIT Australian Real Estate Investment Trust or GRT majority Securityholder) which trades on the JSE under the code “GRT” ASX Australian Securities Exchange HY12, HY13, th
Slide 44: Contact details
Contact details: Growthpoint Properties Australia Level 22, 357 Collins Street Melbourne VIC 3000 www.growthpoint.com.au 120-132 Atlantic Drive, Keysborough, VIC
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