Peach Property Group Ag · SIX:PEAN
Peach Property — H1 2020 Earnings Presentation
47 slides from Peach Property's earnings presentation, Aug 25, 2020
Slide 1: Company Presentation Half-year 2020
PROPERTY GROUP Company Presentation Half-year 2020 August 25, 2020
Slide 2: Disclaimer
Disclaimer ©peach PROPERTY GROUP These materials contain forward-looking statements based on the currently held beliefs and assumptions of the management of Peach Property Group AG, which are expressed in good faith and, in their opinion, reasonable. Forward-looking statements involve known and unkn
Slide 3: Presenters: Dr. Thomas Wolfensberger and Dr. Marcel Kucher
operty Group ©peach PROPERTY GROUP a. Dr. Thomas Wolfensberger Dr. Marcel Kucher
Slide 4: Introduction and strategy
©peach PROPERTY GROUP 1. Introduction and strategy 2. Portfolio as of June 30, 2020 3. Half-year result 2020 4. Outlook 5. Corona Update
Slide 5: Peach Property as of half year 2020
Peach Property as of half year 2020 Highlights 2020 of Peach Property Group ©peach PROPERTY GROUP We are an active real estate investor engaged in the attractive German residential market — with a clear focus on secondary ("B”) cities. Our tenants are at the core of what we do: satisfied tenants who
Slide 6: Significantly increased portfolio market value
ave increased portfolio market icantly more than CHF 1 bn PROPERTY GROUP ©peach Peach as of 30.06.2019 Peach as of 31.12.2019 Peach as of 30.06.2020 Apartments 8,775 12,906 Lettable area 599,596 sqm 848,224 sqm Market value CHF 746.2 mm CHF 1.12 bn Target rent p.a. CHF 46.4 mm CHF 63.3 mm Rentalinco
Slide 7: Portfolio
PROPERTY GROUP a c o 2. ©
Slide 8: Continuously growing portfolio
in growing portfolio ©peach PROPERTY GROUP Acquisition Acquisition Acquisition Acquisition Acquisition Acquisition Acquisition Acquisitions Acquisition of Acquisition residential of two of two. portfolios in of two. of Rheinland, ia. of in Bielefeld 4,200 units of residential portfolio in portfolios
Slide 9: Stable rents and long average tenancy
Peach average tenancy length ~9.0 yrs (rebased to 100) (rebased to 100) no decline in rental prices in c. 20 years across the economic cycle
Slide 10: A cities vs B cities rent development
A cities B cities 30 25 20 15 10 2008 2010 2012 2014 2016 2018 A cities B cities Inflation rate 180% 160% 140% 120% 100% 80% 1990 1995 2000 2005 2010 2015 ▪ ▪ ▪ (1) Bulwiengesa (2) Bulwiengesa, Statista (3) German Economic Institute
Slide 11: Acquisition process
process that results in quisitions... © peach v Almost exclusive focus on off-market Sourcing transactions based on strong network in Germany Impecca- v Swift execution ble v Valued partner respecting confidentiality reputation around deal terms : v Minimum cash-on-cash yield hurdle of Rigorous fina
Slide 12: Value chain: sourcing to asset management
Capital markets ▪ Asset / Property Economic Sourcing Modernization Letting management performance ▪ ▪ ▪ ▪ ▪ ✓ ▪ ▪ ✓ ✓ ✓ ✓ ✓ ▪ ✓ ✓ ✓ Tenant retention ▪ ▪
Slide 13: Tenants at the center of our business
ants in the center of our ©peach PROPERTY GROUP Higher rents, better letting and few damages increase value of real estate Value of Satisfied tenants our real are taking better i care of their home Properties and punish “misconduct” eee t recommend us as through social Cost Rental landlord to family
Slide 14: Proven tenant service model
Proven and time-tested service model that forms the basis for Peach’s strong perception by tenants, ultimately resulting in vacancy reduction and rent optimization
Slide 15: Tenant service model with digital capabilities
360 degree tenant service model: strong digital capabilities embedded in multi-region peach service hubs FULLY DIGITALIZED SCALABLE PLATFORM ‘Tenants Peach Point Channels System Partners Web portal Email Telephone Peach Point ) (-] Essen Erkrath - Kaiserslautern Oberhausen Witzenhausen ®peach Minden
Slide 16: Opportunities in tightening asset market
oportunities in tightening asset ©peach PROPERTY GROUP ..requiring operational improvements ..with focus on lasting tenant together with financial structuring... satisfaction. Multipli ti-stock buildi iti ; | regen ultiplier multi-stock buildings, B cities . ffs ve ffs Ts if at 24 Average —===Maximu
Slide 17: Portfolio milestones H1 2020
olio milestones H1 2020 ©peach Investment jeXeyauce)l(e) PROPERTY GROUP = Acquisition of 496 apartments in the Ruhr area = Increase of Portfolio size to 12,906 apartments (+47% compared to previous year period) with a clear focus on five clusters = Annualized target rent at CHF 63.3 mm, plus 36% vs.
Slide 18: Recent acquisitions
Bielefeld, NRW Essen, NRW Gelsenkirchen and Gladbeck, NRW Velbert, NRW ) acquisitions ©peach PROPERTY GROUP
Slide 19: Portfolio as of June 30, 2020
©peach PROPERTY GROUP . Introduction and strategy . Portfolio as of June 30, 2020 . Half-year result 2020 . Outlook . Corona Update 19
Slide 20: Portfolio structure as of June 30, 2020
ortfolio structure as of June 30, 2020 ©peach Total Portfolio Market Value 1,164.4 mm* 96% A% Investment portfoli 1,119.8 Development nvestment portfolio 119.8 mm 446mm <1% 99% 100% paiizer Germany Switzerland 24mm _ | 1,095.8 mm 44.6 mm * Market values determined by Wiest Partner AG as at 30.06.202
Slide 21: Split by location and usage
Peach Point Split by location (incl. acquisitions) Thuringia 3% Switzerland Lower Saxony <1% 6% Hesse 6% Baden- Württemberg 8% Rhineland- Palatinate 16% North Rhine-Westphalia 61% Split by usage (incl. acquisitions) Parking / Commercial / Other, 3.3% Office 3.8% Residential 92.9% • • • • • •
Slide 22: Investment properties as of 30.06.2020
ent properties as of 30.06.2020 31.12.2019 12,424 Number of residential units Total area in sqm 827,525 Residential area in sqm 786,287 Commercial area in sqm (floor space DIN 277) 38,736 Office space in sqm (floor space DIN 277) 2,502 Actual rental income in TCHF ? 38,915 Maintenance costs in TCHF
Slide 23: Reduction of vacancy ratio
duction of vacancy ratio ©peach PROPERTY GROUP Development of vacant apartments and . , Split of vacant a ents vacancy ratio 1057 1057 -199 12 Esse -158 30.06.2018 30.06.2019 30.06.2020 Total Rented In In Letting vacancy in future letting renovation reserve * Significant reduction in vacancy rate ov
Slide 24: Attractive rent potential
©peach PROPERTY GROUP 6.28 EUR/m* Attractive rent — 567 ow 5.66 potential in all core 539 544 55, portfolios 5.14 484 * Focus on leveraging potential over next quarters (tenant satisfaction, targeted renovations, etc.) Grande Oberhausen Kaiserslautern Ostwestfalen Heidenheim = Nordhessen Peach Portf
Slide 25: Development project Peninsula, Wädenswil
pment project in nswil on Lake Zurich ©peach Peninsula, Wadenswil Peninsula on Lake Zurich with 17,837 sqm land 5,600 sqm commercial space plus 29 rented apartments as investment properties Additionally, 56 condominiums in planning stage; combination of renovating existing buildings and constructing
Slide 26: Half-year result 2020
©peach PROPERTY GROUP Introduction and strategy Portfolio as of June 30,2020 Half-year result 2020 Outlook Corona Update 26
Slide 27: Half-year result 2020
ar result 2020 ©peach PROPERTY GROUP Revenues HY 2017 — HY 2020 Result after tax HY 2017 — HY 2020 TCHF TCHF | 65,039 26496 67 48.510 51789 |! 49.362 | 16.008 14.892 I I I | I | HJ 2017. -HJ2018 HJ2019 | HJ2020 HJ2017 HJ2018 HJ2019 ; HJ2020 Equity ratio 2017 — HY 2020 Portfolio at market values 2017
Slide 28: Overview Key Performance Indicators
Overview Key Performance Indicators ©peach PROPERTY GROUP Rental income | 27,373 — 19,285 +42% Margin | 774% | 70.5% Valuation gains from investment properties | 19,168 | 24,095 -20% Income from development properties | 180 | 7,302 -98% pT Personnel expenses | -5,782 -5,125 413% Other operating expe
Slide 29: Diluted earnings per share and FFO I per share
©peach PROPERTY GROUP Diluted earnings per share Diluted FFO | per share CHF 3.25 CHF 0.87 2.70 1.75 0.17 -0.15 30.06.2018 30.06.2019 30.06.2020 30.06.2018 30.06.2019 30.06.2020 * Reduction in diluted earnings per share due to shift to income from investment properties, reduced earnings from revalua
Slide 30: Rental income and gross margin
©peach PROPERTY GROUP Development rental income : : Rental income by type of use and gross margin HEB Actual rental income — Gross margin TCHF 27.373 Parking & other 3.3% % Commercial & office 3.8%, Residential 92.9% 30.06.2018 30.06.2019 30.06.2020 * Actual rental income increased by 41.9%, compare
Slide 31: Investment property valuation gains
estment property valuation gains luation gains and ss rental yield in of investme Operties Initial valuation [ff Operational progress & discount rate 30.06.2018 30.06.2019 30.06.2020 North Rhine- Westphalia Rhineland- Palatinate Baden- Wurttemberg Hesse Lower Saxony Other locations ©peach Core valua
Slide 32: Operating performance: letting, costs and CAPEX
©peach PROPERTY GROUP (residential * The central speed inhibitor stems from tense construction units) market which prohibits faster renovations Vacancy . : ) + Reduction of vacancy by around 12% 2019 HY 2020 * 2.7% effective vacancy on rentable apartments 6.09 6.30 ; . . 5.85 + A total of 865 leases
Slide 33: Operational costs
operational costs ©peach PROPERTY GROUP Personnel expenses in Other operating expenses in % of income from investment properties % of income from investment properties 15.97 27.92 26.58 21.12 11.91 11.10 30.06.2018 30.06.2019 30.06.2020 30.06.2018 30.06.2019 30.06.2020 * Insourcing of central steps
Slide 34: Financial expenses and tax expenses
©peach PROPERTY GROUP Financial expenses Tax expenses in % of total portfolio value in % of result before tax ——Interest expenses — FX expenses ——other fin. expenses ——Total tax expenses 0.90% 0.68% 0.71% 12.2% ax OT 13.6% 12.7% 0.39% 0.33% 0.21% 0.09% 0.14% 0.20% 30.06.2018 30.06.2019 30.06.2020 30
Slide 35: Balance sheet and liquidity
©peach PROPERTY GROUP Cash & cash equivalents 39,303 46,248 | Development properties 34,589 33,757 Investment properties 1.082.058 (incl. non-current assets held for sale) ‘ ‘ PT Current financial liabilities 31,049 37,869 Non-current financial liabilities 750,514 © 703,446 P| Net LTV Ms 59.6% Net s
Slide 36: Financial liabilities and maturity structure
©peach PROPERTY GROUP TCHF 3 .2020 | 31.12.2019 : prc [31122019 TM aturity structure 30.06.2020 Current mortgages | 21544 | 28.358 thereof for development properties 11,928 | 12,024 more than up to Lyear 5 years 30.544 Non-current mortgages | 392,664 | 348,554 227.435 of it for new investment proper
Slide 37: Cost of liabilities
ast Liabilities ©peach PROPERTY GROUP Financial liabilities & bond ® Mortgages & building loans 3.52% 3.61% 3.59% 31.12.2018 31.12.2019 30.06.2020 * Slight decrease of financing cost from approx. 2.81% (2019: 2.84%) * Rates include interest rate hedges (mostly swaps) * Financing for German portfolio
Slide 38: Equity and equity ratio
©peach PROPERTY GROUP Equity and equity ratio at market values Equity values 30.06.2020 31.12.2019 NAV IFRS (TCHF) 399,539, 389,564 401.298 407.438 NAV market value (TCHF) 407,438 401,298 314.061 thereof hybrid bonds (equity) (TCHE) 91,696 Equity ratio (NAV IFRS) 518% 32.3% NAV (IFRS) per share (CHF
Slide 39: Outlook
©peach PROPERTY GROUP 1. Introduction and strategy 2. Portfolio as of June 30, 2020 3. Half-year result 2020 4. Outlook 5. Corona Update 39
Slide 40: Further growth in rental income
rther growth in rental income ©peach operational efficiency PROPERTY GROUP Optimization of the existing investment portfolio Increase of tenant satisfaction Further vacancy reduction Rent optimization Reduction of non- recoverables Increase of administrative efficiency (cluster, digitalization....)
Slide 41: Acquisition of 5,449 apartments
quisition of 5,449 apartments ©peach PROPERTY GROUP Strategic rationale for . Significant increase in target rental income to over acquisition CHF 86 mm ¢ Leverage digital platform with significant economies Maintaining proximity to tenants by opening three new Peach Points; positive effects also fo
Slide 42: Optimal addition to the existing portfolio
Optimal addition to the existing portfolio ©peach PROPERTY GROUP Excellent match with current portfolio Acquisition optimally extends current portfolio: * Rhein/Ruhr region (15,150 apartments) * Kaiserslautern region (2,570 apartments) Further smaller new clusters include * Monchengladbach (250 apar
Slide 43: Pro forma portfolio
©peach PROPERTY GROUP Apartments Lettable space Market value Target rent p.a. Rental income p.a. Gross rental yield Vacancy Portfolio as of H1 2020 Portfolio acquisition Total Portfolio Peach pro forma 12,906 apartments 848,224 sqm CHF 1.13 Bn. CHF 63.3 Mio. CHF 55 Mio. 5.1% 8.2% 43
Slide 44: Corona Update
©peach PROPERTY GROUP 1. Introduction and strategy 2. Portfolio as of June 30, 2020 3. Half-year result 2020 4. Outlook 5. Corona Update 44
Slide 45: Corona update
©peach PROPERTY GROUP E \ ™ So far, no corona cases at Peach mptoyee ™ Transition to home office and back worked smoothly : ™ All Peach Points with corresponding protection concepts reopened Operations [i Availability via Skype/phone/mail/app at any time ’ =" Leasing ,on track"; so far August was th
Slide 46: Attractive investment case
Experienced team with a proven transaction track record Germany: attractive real estate market with very good perspectives Successful investment strategy ng term growth a value orientation Sound equity basis Se | Pe Attractive investment case ©peach > CHF 2 bn successful transactions since 2013 Stro
Slide 47: Investors, Analysts and Media contact
y = Investors, Analysts and Media: ©) peach Dr. Thomas Wolfensberger, Chief Executive Officer PROPERTY GROUP Dr. Marcel Kucher, Chief Financial Officer +41 44 485 50 00 investors@peachproperty.com Wachsen mit Werten.