Gpt Group · ASX:GPT
Gpt — GPT Funds Management — GPTFM EGM and Investor Forum May 2015
61 slides from Gpt's conference presentation, May 2015
Slide 1: GPT Funds Management 2015
2015 GPT FUNDS MANAGEMENT
Slide 2: Agenda
AGENDA Extraordinary General Meeting Welcome by Gary Symons, Independent Chairman – GPT Funds Management Chairman Item 2.0 Approval of Appointment of Ms Beth Laughton as an Independent Director Investor Forum GPT Update Nicholas Harris, Head of Funds Management Team Chris Moses-Zahar, Senior Fund An
Slide 3: Extraordinary General Meeting: Formal Business
EXTRAORDINARY GENERAL MEETING FORMAL BUSINESS OF THE GPT FUNDS MANAGEMENT EXTRAORDINARY GENERAL MEETING
Slide 4: Formal Business: Appointment of Independent Director
FORMAL BUSINESS GPT Funds Management Extraordinary General Meeting ITEM 2.0 Approval of appointment of Ms Beth Laughton as an Independent Director of the Responsible Entity of the Funds for a term commencing on 19 May 2015 and expiring at the Annual General Meeting in November 2017 To consider and,
Slide 5: Formal Business: Appointment of Independent Director (Voting Results)
FORMAL BUSINESS GPT Funds Management Extraordinary General Meeting ITEM 2.0 Approval of appointment of Ms Beth Laughton as an Independent Director of the Responsible Entity of the Funds for a term commencing on 19 May 2015 and expiring at the Annual General Meeting in November 2017 To consider and,
Slide 6: Extraordinary General Meeting
EXTRAORDINARY GENERAL MEETING FORMAL BUSINESS OF THE GPT FUNDS MANAGEMENT EXTRAORDINARY GENERAL MEETING
Slide 7: Investor Forum: Welcome
INVESTOR FORUM WELCOME NICHOLAS HARRIS HEAD OF FUNDS MANAGEMENT
Slide 8: Investor Forum Agenda
AGENDA GPT Update Nicholas Harris, Head of Funds Management Team Chris Moses-Zahar, Senior Fund Analyst – GPT Wholesale Office Fund Introductions Paul Caddy, Senior Fund Analyst – GPT Wholesale Shopping Centre Fund GWOF Update Martin Ritchie, Fund Manager – GPT Wholesale Office Fund GWSCF Update Mic
Slide 9: GPT Update
INVESTOR FORUM GPT UPDATE NICHOLAS HARRIS HEAD OF FUNDS MANAGEMENT
Slide 10: 2014 Annual Result Highlights
2014 ANNUAL RESULT HIGHLIGHTS Delivering on strategy with a disciplined, consistent and transparent approach Delivering consistent results from core business − 4.1% EPS1 growth − 9.6% Total Return Disciplined capital allocation − $2 billion of transactions Proven Development and Funds Manageme
Slide 11: 2015 Highlights
2015 HIGHLIGHTS Delivering on strategy with a disciplined, consistent and transparent approach Redemption of Exchangeable Securities funded with Equity − Exchangeable Securities redeemed at an attractive valuation − Equity raising of $325 million and Security Purchase Plan (SPP) capped at $50 mill
Slide 12: Our Outlook
OUR OUTLOOK Strong performance in a subdued environment Fundamentals remain mixed Business confidence and consumer sentiment remain subdued though helped by the recent ECONOMY interest rate cut and fuel costs Improvement in the contribution of the non-mining sectors over the second half of 201
Slide 13: Property to Prosperity
PROPERTY TO PROSPERITY ¢ Delivering consistent returns from the core portfolio e Funds Management outperformance ¢ Development capability creating material value ¢ Disciplined capital allocation and management delivers consistent long term performance targeting >9% Total Return ¢ EPS growth guidance
Slide 14: Team Introductions
INVESTOR FORUM TEAM INTRODUCTIONS NICHOLAS HARRIS HEAD OF FUNDS MANAGEMENT
Slide 15: Chris Moses-Zahar, Senior Fund Analyst
INVESTOR FORUM TEAM INTRODUCTION CHRIS MOSES-ZAHAR SENIOR FUND ANALYST GPT WHOLESALE OFFICE FUND
Slide 16: Paul Caddy, Senior Fund Analyst
INVESTOR FORUM TEAM INTRODUCTION PAUL CADDY SENIOR FUND ANALYST GPT WHOLESALE SHOPPING CENTRE FUND
Slide 17: GWOF Update
INVESTOR FORUM GWOF UPDATE MARTIN RITCHIE FUND MANAGER GPT WHOLESALE OFFICE FUND
Slide 18: Snapshot - May 2015
SNAPSHOT - MAY 2015 Best Performing Ww 7 year MIN WW 72 °70/, Office Fund $150m ae in index j for the year to over 1,3,5& issued March 2015 7 years Asset DRP Non-core upgrades asset hee Centre, switched sales Riverside Centre & 750 Collins St off planned
Slide 19: Outperformance vs Peers
OUTPERFORMANCE @@pe AN VS PEERS PERFORMING D DIRECT OFFICE INDEX OFFICE MERCER/IPD AUSTRALIAN WHOLESALE UNLISTED PFI - OFFICE FUND PCA/IPD AUSTRALIA ALL PROPERTY INDEX - OFFICE 14% 12% Total Return [p.a.) a eS cl ry x 2 8 8B y & 2 & Mercer/IPD Aus’ 128 14 10.6 10.7 1n.0 96 96 9.0 9.0 i 79 8.0 o 77 6
Slide 20: Market Leading Performance
MARKET LEADING PERFORMANCE 12.7% IRR GWOF 1 YEAR TOTAL RETURN 12 MONTHS 10 (ROLLING ANNUAL RETURN ON QUARTERLY RESTS) So) MARCH 2019 25 20 15 } SSESSSS8RSssessee22e2rrrrsesss2e22222238 Bete ae 2 SSeS ee See Se Se See SHFRPSFSPESFRPESFSESFSESFSESFSESHERSS =u Income =u Capital — IRR — 9% Target
Slide 21: Current Unit Price and Weighted Average Cap Rate
CURRENT UNIT PRICE CURRENT UNIT PRICE AND WEIGHTED AVERAGE CAPITALISATION RATE WEIGHTED AVERAGE CAP RATE 6.41% 8.00 (%) YOVM. ($) @214d Wun mmm CUV ——WACR
Slide 22: Asset Prices: Nearing the Top of the Cycle?
ASSET PRICES NEARING THE TOP OF THE CYCLE? Recession GFC 9.0% 8.5% 8.0% 7.5% 7.0% 6.5% 6.0% 5.5% 5.0% 985 1987 1989 1991 1993 1995 1997 1999 200 2003 2005 2007 2009 2011 2013 2015 Where are we now? « Australian office property capital values are mid-to-late cycle «Rental values are in early upswing
Slide 23: Goals
GOALS TO CONSISTENTLY BE THE BEST PERFORMING WHOLESALE OFFICE FUND IN AUSTRALIA = To maintain the unique competitive advantage of the Fund, being a high quality portfolio of assets and manage them to attract business and to maximise rents. = To have sufficient liquidity at Liquidity Review in July 2
Slide 24: GWOF's Portfolio Strategy
GWOF'’s Portfolio strategy istoowna diverse collection of the best office buildings in Australia and manage themto attract business and to Maximise rents or: SN
Slide 25: Portfolio Strategy
PORTFOLIO STRATEGY CONSISTENT STRATEGY STRATEGY COMMENTS Seek to be a rent setter, not a rent taker at the top end of the market in selected locations NT SETTER Generic assets at lower rent price points offer higher yields and greater risk ENHANCE ASSET QUALITY Seek new, Prime-grade, high environmen
Slide 26: Portfolio Metrics
PORTFOLIO METRICS 545 Queen Street 2% 655 Collins Street 2% Brisbane Transit Centre (50%) 1% Twenty8 Freshwater Place (50%) 2% The Zenith (50%I 3% 150 Collins Street 3% workplace’ 3% 8 Exhibition Street (50%) 3% Ap Darling Park 1 & 2 (50%) 12% Riverside Centre 11% 2 Southbank Boulevard (50%) 4% SYDN
Slide 27: Improving Portfolio Quality
IMPROVING PORTFOLIO QUALITY Be Mmueess &¢ |
Slide 28: Improving Portfolio Quality: Sales in 2015
IMPROVING PORTFOLIO QUALITY SALES IN 2015: NON CORE ASSETS IN SECONDARY LOCATIONS The Zenith 545 Queen Street : Transit Centre PREMIUM GRADE INCREASE on r | $140 million $84 ayilani $62 1 million Outcomes: « Achieve greater management efficiency with fewer assets » Achieve lower risk to future incom
Slide 29: Improving Portfolio Quality: Building Upgrades
IMPROVING PORTFOLIO QUALITY (qpascall BUILDING UPGRADES TO ADD VALUE 3 YEARS Continue to upgrade the portfolio to maximise rental growth and returns Ownership HSBC Centre, Sydney! 100% Riverside Centre, Brisbane? 100% 750 Collins Street, Melbourne® 100% Darling Park 2, Sydney* 50% +) Development com
Slide 30: Capital Management
Drawn Debt ($m) CAPITAL MANAGEMENT MTN ISSUED = Medium Term Note (MTN) issue: 7 years, $150 million, 4.19% fixed rate = DRP switched off to enhance returns = Asset sales would reduce gearing to 12% Soles GEARING 1,600 1,400 Target gearing upper limit - 30% 1,200 Tarsetsearing 1,000 - 800) Target gea
Slide 31: Summary
SUMMARY Defer the One One One Eagle Street acquisition as values are currently high and the option window is long Selling three non-core assets ($286 million] may be possible in 2015 to improve portfolio quality and long term returns. Also creates liquidity, but dilutes short term returns if not re-
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Slide 33: GWSCF Update
INVESTOR FORUM GWSCF UPDATE MICHELLE TIERNEY FUND MANAGER GPT WHOLESALE SHOPPING CENTRE FUND
Slide 34: Snapshot - May 2015
SNAPSHOT - MAY 2015 Wollongong Highpoint Highpoint Shopping Central won Shopping Centre Centre won PCA 2 Two international _ won PCA Victorian Best Shopping awards Development Centre at the acclaimed of the Year Development Architizer A+ Awards! Casuarina Square Student DRP 18 months’ Accommodation
Slide 35: Performance vs Peers: Retail Sector
PERFORMANCE > VS PEERS RETAIL SECTOR FYTD MERCER/IPD AUSTRALIAN WHOLESALE UNLISTED PFI - RETAIL SECTOR (MARCH 2015) 10 | 8.5 ; . 8.1 83 on . 8) ua Oo z 74 6.6 6.7 f & 47 zs as 30 24 1/ Oo. = = r GPT Wholesale Mercer/IPD AMP Capital Shopping Australian Prime QIC Shopping Shopping All Retail Index Cen
Slide 36: Consistent Income Returns
CONSISTENT INCOME RETURNS SINCE INCEPTION 6.0% INCOME YIELD GWSCF 1 YEARIRR (ROLLING ANNUAL RETURN ON QUARTERLY RESTS) IRR (%) i income @& capita —— 9% Target eeeexegeg 822222 r tr re rsxsaaeeen72727234 eee ee sss ssess SP eLS2e SF FF esse eereree2e272 2 FFF ®SS&ssStBeBESSFRBRBESSRBESPFREBESSE BEES
Slide 37: Current Unit Value and Weighted Average Cap Rate
(4) YOWM SL4eW 74320 7) das yL une 7L4eW e199 1 das eL unr el sew 24290 | ZL dag | ZL une ZL 4eW tb39q LEdas ey |) (pee HL+eW ee 0! 2°0 ey 01 (25 a 01 unr (01 4eW a 602° mm 460 des ee 60 "7 6048W 8090 80 das gounr 80 4EW 4090 40.425 | Lune uondacuy CURRENT UNIT VALUE MCUV ===» WACR WEIGHTED AVERAGE
Slide 38: Portfolio Metrics
PORTFOLIO METRICS NEIGHBOURHOOD 5% 8 ) = wy PORTFOLIO OF 10 ASSETS MAJOR REGIONAL 19% fees SUPER REGIONAL CITY CENTRE 13% ceicaghilncs PRIME REGIONAL SUPER REGIONAL 44% 95%
Slide 39: Specialty Sales Growth
SPECIALTY SALES GROWTH cnowrs bh ? Yo MARCH 2015 COMPARED TO PRIOR YEAR SPECIALTY SALES GROWTH Specialty Monthly Sales Growth (%) s N o Rn — 4 “3.4 on nm am am nm nm om mm Mm ts ts Fe esewertwertwstwyrtwyrtsyrst Ts HH geee2e2ee2222e2e22 282888 822222288 SEE RS REP ESE PRES SESS ES EE RRs FSSFFSESREP
Slide 40: Goals
GOALS TO CONSISTENTLY BE THE BEST PERFORMING WHOLESALE SHOPPING CENTRE FUND IN AUSTRALIA = Deliver target total portfolio return (unlevered) of 8.5 - 10.0% and long term total equity returns »9% = To have sufficient liquidity entering into 2017 liquidity review to satisfy investor's likely redemptio
Slide 41: Dynamic Retail Assets Connect, Evolve and Grow
OF DYNAMIC RETAIL ASSETS T Wel al CONNECT EVOLVE AND GROW |: WITH THEIR COMMUNITIES “
Slide 42: Portfolio Strategy
PORTFOLIO STRATEGY FUND ASSETS MUST MEET THE FOLLOWING CRITERIA PRIME Assets that dominate, or have the ability to dominate ASSETS their trade area DEFINED POSITIONING Have a well defined position in the trade area retail hierarchy GROWTH MARKETS Located in growth markets ABILITY TO DELIVER Have the
Slide 43: Investment Strategy
INVESTMENT STRATEGY SUPER & MAJOR REGIONAL STRATEGY COMMENTS HIGHPOINT SHOPPING CENTRE Hold Investigating next stage: additional supermarkets MACARTHUR SQUARE Hold and develop Final Investment Proposal underway WESTFIELD WODEN Hold and develop Preliminary Investment Proposal underway NORTHLAND SHOPP
Slide 44: Asset Expansion Opportunities
ASSET EXPANSION OPPORTUNITIES (eaxaall ENHANCING RETURNS PIPELINE Highpoint Shopping Centre’ 58.33% $10m Casuarina Square* 50% $13.5m Macarthur Square 50% $115m Westfield Woden” 50% $8.5m Parkmore Shopping Centre* 100% $25m Chirnside Park 100% $65m Highpoint Shopping Centre * 58.33% $65m Casuarina S
Slide 45: Casuarina Square Student Accommodation
CASUARINA SQUARE STUDENT ACCOMMODA Development completed February 2015 - $31.5 million First step towards the transformation of Casuarina Square into a “town centre” Strategy to ensure continued success and dominance in Darwin market
Slide 46: Macarthur Square Western Expansion
MACARTHUR SQUARE WESTERN EXPANSION Planned $230 million (100%) expansion, subject to Board approval Relocation of Coles to new Market Hall and addition of new convenience and fashion malls New format David Jones and potential international mini majors UAGARTHOR SUR
Slide 47: Asset Remix
ASSET REMIX CURRENT AND ENHANCING ASSETS _ Bits impression of Casuarina Square, NT Casuarina Square - Leisure and Entertainment Pr Westfield Woden - Leisure and Entertainment Remix
Slide 48: Capital Management
Drawn Debt ($m) CAPITAL MANAGEMENT DRP SWITCHED OFF = Sale of Forestway Shopping Centre would reduce gearing to ~14% in the short term . . . 8) = Proceeds reinvested in asset expansion ii 0 opportunities over time . GEARING Sieisleisiateieiiieiateiatad 30 Target gearing upper limit - 30° 1,000 me nz
Slide 49: Nearing the Top of Cycle?
NEARING THE TOP OF CYCLE? Weighted Average Retail Yields ze 2 au = 10 29 es 27 Ze = 5 reese essere RscSEssesesessepezgseseeree22 PARP PAPIAZAIIAAZAL IPF AZIFPAZII722 Regional ——~Sub-regional ———=Neighbourhood Where are we now? = Australian property capital values are mid-to-late cycle = Regional cap
Slide 50: Summary: Transformation of the Fund
SUMMARY TRANSFORMATION OF THE FUND Optimise returns = Focus to enhance Fund returns Portfolio Strategy = $625 million of asset expansion opportunities exist to potentially enhance Fund returns where market opportunity and commercial feasibility exists = Active management of portfolio will continue w
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Slide 52: GPT Property Innovations
INVESTOR FORUM GPT PROPERTY INNOVATIONS SIDONE THOMAS NATIONAL DIRECTOR DIGITAL AND INNOVATION
Slide 53: Property Innovations: Three Core Focuses
PROPERTY INNOVATIONS Three core focuses DIGITAL DATA INNOVATION 54
Slide 54: Mobile is one of the most important technologies of our generation
Mobile is the one of the most important technologies of our generation 16 MILLION smartphone users in 79% Australia of smartphone users are 84% of smartphone smartphone shoppers shoppers use mobile in-store 100% of smartphone users are WiFi enabled
Slide 55: Harnessing the power of data to drive better customer experiences
Harnessing the power of data to drive better customer experiences SkyFii designs, builds and manages large scale, high quality public Wi-Fi networks across an international portfolio of premium assets > Delivers a seamless, high quality free Wi-Fi experience > Supports a premium in-centre customer e
Slide 56: Space&Co
Slide 57: Space & Co Case Studies
SPACE & CO Case studies Rouse Hill Town Melbourne Central One One One Eagle Centre Tower Street 58
Slide 58: Glamping at Melbourne Central
GLAMPING AT MELBOURNE CENTRAL St Jerome’s Hotel When you escape to St Jerome’s – The Hotel, you get more than stylish comfort with a taste of the outdoors; you get a complete experience. Every guest is a VIP, greeted by valet car service prior to checking in with their ‘guru’ host who will indiv
Slide 59: Melbourne's new glamping rooftop hotel
CAMPINGHITS .. ‘MELBOURNE'S NEW ‘GLAMPING’ ROOFTOP HOTEL CITY HEIGHTS ~~ a WITH Melbourne's first five-star rooftop tent hotel heavily booked by = : romantics andlovers,the j= ~ — = obvious question has : become: "How do you get amorous in canvas accommodation so dose to Y your next-door neighbour?”
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Slide 61: Forum Close
INVESTOR FORUM FORUM CLOSE NICHOLAS HARRIS HEAD OF FUNDS MANAGEMENT
GPT Funds Management — GPTFM EGM and Investor Forum May 2015 on 6ix