Deutsche Wohnen Se · XETR:DWNI

Deutsche Wohnen — Investor Presentation (November 2016)

27 slides from Deutsche Wohnen's investor presentation, Nov 15, 2016

1. Slide 1: Nursing and Assisted Living Segment presentation November 2016

   Deutsche Wohnen AG » Nursing and Assisted Living Segment presentation November 2016

2. Slide 2: Table of contents

   » Table of contents 1 German nursing care market 2 Regulatory environment 3 Deutsche Wohnen’s nursing business Appendix 2

3. Slide 3: German nursing care market

   » German nursing care market 3

4. Slide 4: Overview of German nursing market

   » Overview of German nursing market Care dependent people by age groups Overview of market segments 50 46.2% 45 2.6m care dependent people 40 35 30 1.86m (71%) 0.76m (29%) outpatient care inpatient care 25 21.0% 20 thereof 1.25m provided c.13,000 nursing 15 by relatives facilities 9.8% 10 4.1% 3.3%

5. Slide 5: Key demographic trends in Germany

   » Key demographic trends in Germany Ageing population leads to increasing demand Increasing share of age groups 65+ and 80+ for nursing homes 5%  Nursing care market driven by (irreversible) 23% 15% demographic trends - increasing demand for social, medical and nursing services 2013  Main reasons

6. Slide 6: Outlook for German nursing market

   » Outlook for German nursing market Estimated number of people Probability of need of care Forecast for inpatient care in need of care (m) by age group (%) (# of beds in m) 70 1,2 3,4 3,2 60 1,0 Probability of need of care (%) 2,9 2,6 50 2,4 0,8 2,1 40 0,6 30 0,4 20 10 0,2 0 0,0 1999 2001 2003 2005

7. Slide 7: Forecast - required additional nursing home beds by federal state

   » Forecast - required additional nursing home beds by federal state Additional demand for care beds by 2030 Additional demand for care beds by 2030 (constant nursing home ratio 2013)¹ (nursing home ratio 2013 +5%)² Schleswig-Holstein Schleswig-Holstein 16,357 Mecklenburg- 23,403 Mecklenburg- West Po

8. Slide 8: Market structure – nursing home operators

   » Market structure – nursing home operators Nursing home operators split by type (# of beds)  Nursing home operator market is very fragmented  Top ten private operators only account for c. 13% of overall market (measured by number of beds)  Non-profit and public operators manage c. 60% Non-profit

9. Slide 9: Market structure – nursing home properties

   » Market structure – nursing home properties Nursing homes yield spread significantly above other asset classes  Nursing home property market accounts for c. 1-3% 7,5 of overall commercial real estate transaction volume 6,5  Nursing home properties offer attractive yields at low risk: 5,5  Fundam

10. Slide 10: Regulatory environment

    » Regulatory environment deutsche-wohnen.com ‘ ) a Deutsche Wohnen

11. Slide 11: Overview of regulatory environment in Germany (1/2)

    » Overview of regulatory environment in Germany (1/2) Standard daily cost breakdown of nursing homes  Germany is one of few countries which requires all citizens to have either public or private long-term 15% care insurance Nursing services costs  Care Funds (Pflegekassen) provide a cost cover for

12. Slide 12: Overview of regulatory environment in Germany (2/2)

    » Overview of regulatory environment in Germany (2/2)  No formal permission (except for building laws) required to set up new nursing homes New homes authorization  Operators entitled to enter into new supply contract with Care Funds (Pflegekassen) as soon as structural requirements for operating

13. Slide 13: Deutsche Wohnen's nursing business

    » Deutsche Wohnen’s nursing business 13

14. Slide 14: Deutsche Wohnen nursing business at a glance

    » Deutsche Wohnen nursing business at a glance Legal structure of DW nursing business  Beginning of 2015, the operational business of Katharinenhof was transferred into a partnership Family office structure (partner)  Deutsche Wohnen has a 49% stake; fully 100% 49% consolidated 51%  51% partner i

15. Slide 15: Nursing homes - portfolio overview

    » Nursing homes - portfolio overview Existing nursing business: Assets and operating business1) # of places Assisted Facilities Nursing Total Area Occupancy Fair Value Katharinenhof Region living # # # (sqm) rate (30/06/2016) # Greater Berlin 12 1,072 370 1,442 84,250 98.0% Saxony 7 436 39 475 21,83

16. Slide 16: Portfolio details pro forma recent acquisition

    » Portfolio details pro forma recent acquisition Assets & Operations versus Assets only Distribution by operators Assets & Operations Pro-Seniore 4% 10% 8% Assets only - WALT <10 Katharinenhof (DW Group) 40% years 46% 35% Assets only - WALT 10- 42% Korian (Phoenix & Casa 15 years Reha) 15% Assets on

17. Slide 17: Portfolio images (1/2)

    » Portfolio images (1/2) Uferpalais Uferpalais Im Schlossgarten Wolkenstein 17

18. Slide 18: Portfolio images (2/2)

    » Portfolio images (2/2) Heinrich-Lassen Am Lunapark Wilsdruff Uferpalais Wilsdruff Wilsdruff 18

19. Slide 19: Development of KPI's of the operating nursing business

    » Development of KPI’s of the operating nursing business High occupancy rate is a good proof point for Strong revenue growth operational excellence Revenues (EURm) Occupancy rate 98.7% 96.1% 96.1% 97.2% 68.2 67.2 ~70 59.9  German occupancy rate: ̴ 85% 2013 2014 2015 9M 2016 31/12/2013 31/12/2014 31

20. Slide 20: Condensed P&L for operations and assets

    » Condensed P&L for operations and assets Operations (in EUR m) 9M 2016 9M 2015 in EUR m 9M 2016 9M 2015 Total income 52.4 49.9 Nursing 41.5 39.7 Total expenses (47.1) (45.9) Living 4.9 4.6 EBITDA operations 5.3 4.0 Other 6.0 5.6 EBITDA margin 10.1% 8.0% in EUR m 9M 2016 9M 2015 Lease expenses1) 9.7

21. Slide 21: Successful Pegasus acquisition will drive earnings growth further

    » Successful Pegasus acquisition will drive earnings growth further EBITDA contribution of nursing business (EUR m) FFO I contribution of nursing business (EUR m) ~26 ~ 43 ~23 ~36 ~17 ~13 13.7 10.4 Total Existing portfolio Existingacquisition Pegasus portfolio Pegasus Acqusition Pro-forma EBITDA Tot

22. Slide 22: Competitive strength and strategy

    » Competitive strength and strategy  Accelerate internal growth by further specialization of facilities on dependency needs (e.g. dementia) Significant internal  Enhancement of product offering (combination of outpatient care and day-care with existing growth potential nursing facilities)  Active

23. Slide 23: Appendix

    » Appendix deutsche-wohnen.com ‘ ) a Deutsche Wohnen 23

24. Slide 24: Overview of "Pegasus" acquisition (1/2)

    » Overview of “Pegasus” acquisition (1/2)  28 nursing (c. 3,700 places) and  Facilities of high quality in good locations assisted living facilities (c. 400 Object of predominantly in West Germany places) with 180k sqm purchase  Only assets acquired, not the  Good market positioning from a price

25. Slide 25: Overview of "Pegasus" acquisition (2/2)

    » Overview of “Pegasus” acquisition (2/2) Pro Seniore Residenz (Oberau, Bavaria) Pro Seniore Residenz (Kempten, Bavaria) Pro Seniore Residenz (Radolfzell, Baden-Württemberg) Sozialkonzept Cäcilienhof (Garbsen, Lower Saxony) 25

26. Slide 26: Disclaimer

    » Disclaimer This presentation contains forward-looking statements including assumptions, opinions and views of Deutsche Wohnen or quoted from third party sources. Various known and unknown risks, uncertainties and other factors could cause actual results, financial positions, the development or the

27. Slide 27: Deutsche Wohnen AG

    Deutsche Wohnen AG Registered Office Berlin Office Pfaffenwiese 300 Mecklenburgische Straße 57 65929 Frankfurt/ Main 14197 Berlin Phone: +49 30 897 86 5413 Fax: +49 30 897 86 5419 © 2016 Deutsche Wohnen AG

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