Slide 1: 2017 Financial Results Presentation
2017 FINANCIAL RESULTS PRESENTATION Frankfurt am Main MARCH 2018
Slide 2: Table of Contents
TABLE OF CONTENTS HIGHLIGHTS FINANCIAL HIGHLIGHTS FINANCIAL RESULTS CAPITAL MARKETS ACTIVITY OPERATIONS AND PORTFOLIO APPENDIX 2
Slide 3: Highlights
HIGHLIGHTS Corporate achievements: Up-listing to Prime Standard of Frankfurt Stock Exchange (June 17) Sustainalytics outperformer in ESG disclosure in Environmental, Social and Governance ranking in the 88th percentile globally (August 17) EPRA Gold award for highest reporting disclosure (September
Slide 4: Financial Results
FINANCIAL RESULTS 4
Slide 5: Profit and Loss
PROFIT AND LOSS 1-12/2017 1-12/2016 Net rental income, recurring long-term* (in €M) € million NET RENTAL INCOME, RECURRING LONG-TERM 415.2 233.4 CAGR 2015 - of which relating to properties marked for disposal 33.8 - Apr 2018 annualized run rate NET RENTAL INCOME 449.0 233.4 RENTAL AND OPERATING INCO
Slide 6: Adjusted EBITDA
ADJUSTED EBITDA 1-12/2017 1-12/2016 € million subtracted as these profits include AT’s Operating profit 1,920.3 1,107.0 share in non-operational profits Depreciation and amortization 2.0 2.0 generated by the equity accounted EBITDA 1,922.3 1,109.0 Revaluations, capital gains and other income (1,326.
Slide 7: FFO I
FFO I FFO I (in €m) 1-12/2017 1-12/2016 € million ADJUSTED EBITDA COMMERCIAL PORTFOLIO 369.1 194.5 CAGR 2015 - Apr 2018 Finance expenses (69.7) (47.4) +80% Current tax (33.5) (19.9) 369 Contribution to minorities (8.9) (7.5) 293 FFO I COMMERCIAL PORTFOLIO 257.0 119.7 FFO relating to properties marke
Slide 8: Maintenance, Capex and AFFO
MAINTENANCE, CAPEX AND AFFO 2016 capex: €30.5m 2017 capex: €73.4m Ratio of investment Ratio of investment property: 0.6% property: 0.7% Due to strong landlord position tenant improvement ratio decreased in 2017, thus higher relative costs are born by the tenants Expansion Capex: Tenant Improvement:
Slide 9: Total Assets
TOTAL ASSETS Dec 2017 Dec 2016 ACQUISITIONS (in €bn) TOTAL ASSETS (in €bn) € million Investment property 9,804.1 5,016.2 CAGR 2015 - 2017 Equity accounted-investees, holding in GCP SA 1,609.7 1,316.7 +77% Equity accounted-investees, other 295.9 240.3 3.7 Non-current assets 12,247.3 6,988.9 13.8 Asse
Slide 10: EPRA NAV
EPRA NAV Dec 2017 Dec 2016 EPRA NAV (in €bn) € million Per share € million Per share NAV per the financial statements 7,249.9 3,941.1 CAGR 2015 - Equity attributable to perpetual notes investors (1,173.3) (478.3) 2017 pro forma incl. perpertual notes NAV excluding perpetual notes 6,076.6 3,462.8 Eff
Slide 11: Conservative Capital Structure
CONSERVATIVE CAPITAL STRUCTURE Debt maturity profile Proactive debt management Debt Maturity Cost of Debt +2.3 years -40 bps 7.8 2.0% years 5.5 years 1.6% 2016 2017 2016 2017 Loan-to-Value Strong cover ratios Unencumbered assets Company BOD limit of 45% 5.4x 71% €7.1bn 4.5x 3.8x 56% 39% 3.3x 36% 33%
Slide 12: Best in class financial ratios among peers
I. BEST IN CLASS FINANCIAL RATIOS AMONG PEERS II. HIGHEST RATED IN GERMAN COMMERCIAL REAL ESTATE Financial risk profile Financial policy: 1 2 3 4 5 6 Minim Modest Aggre High al Intermediate Significant ssive Levera Strive to achieve A- global rating in the long ged term 1 aaa/ bbb- Business risk pro
Slide 13: Capital Market Activity
CAPITAL MARKET ACTIVITY Capital market activity per issuance type 2015-2018 YTD Major index inclusions in 2017/2018 €4.2bn EUROPE 600 Equity and bond bookrunners Largest European Capital market activity per year real estate issuer in 2016 and 2017 13 13
Slide 14: Operations and Portfolio
OPERATIONS AND PORTFOLIO 14
Slide 15: Commercial Investment Properties (Dec 2017)
COMMERCIAL INVESTMENT PROPERTIES (DEC 2017) Portfolio breakdown per asset type Investment Area EPRA vacancy Annualized net In-place rent per Value per sqm Rental yield properties (in 000' sqm) rent (in €M) sqm (in €) (in €) (in €M) Office 5,935 2,578 11.2% 300 10.5 2,302 5.2% Hotel 1,817 758 3.4% 87
Slide 16: Commercial Portfolio – Potential to Come
COMMERCIAL PORTFOLIO – POTENTIAL TO COME Commercial in-place rent Commercial current annualized Rental Income vs. compared to market rent prices Market potential including vacancy reduction Large upside potential from rent increases to market levels with very limited downside risk Long lease terms w
Slide 17: Top Tier Cities (Dec 2017)
TOP TIER CITIES (DEC 2017)* Asset Type Breakdown accounting for 38% holding in GCP Residential geographical breakdown Commercial geographical breakdown 17 * all breakdowns are by value
Slide 18: Top Tier Cities within Asset Classes (Dec 2017)
TOP TIER CITIES WITHIN ASSET CLASSES (DEC 2017)* Commercial asset type breakdown Office geographical breakdown Logistic/Wholesale/Other geographical breakdown Hotel geographical breakdown Retail geographical breakdown 18 * all breakdowns are by value
Slide 19: Best in Class Berlin Portfolio
BEST IN CLASS BERLIN PORTFOLIO 88% of the commercial portfolio is located in top tier neighborhoods • Charlottenburg, Wilmersdorf, Mitte, Kreuzberg, Lichtenberg, Schöneberg, Neukölln, Steglitz and Potsdam • strongly benefiting from the unique dynamics and growth of Berlin’s most in demand neighborh
Slide 20: Berlin – Potsdamer Platz
Berlin Berlin Potsdamer Platz landmark property Quality Berlin assets around Potsdamer Platz Office Berlin Potsdamer Platz Checkpoint Office Charlie Checkpoint Charlie Office Crowne Plaza Potsdamer Platz Hotel Berlin Potsdamer Platz Office Berlin Potsdamer Platz Office Potsdamer Platz
Slide 21: Berlin – Kurfürstendamm
Berlin landmark property Quality Berlin assets around Kurfürstendamm (Ku’Damm) KaDeWe Residential (GCP) Ku’damm /Uhlandstr. Office Ku’Damm Mark Apart Kurfürstendamm Hotel (Ku’Damm) Ku’damm – Adenauerplatz Office Ku’damm / Lietzenburger Str. Residential (GCP)
Slide 22: Frankfurt
Frankfurt Quality Frankfurt assets in central locations InterContinental Frankfurt Frankfurt am Main HBF Hotel Offices Frankfurt Frankfurt am Main Hauptbahnhof Frankfurt Büro Center (FBC) (Central Train Office Station) Frankfurt am Main Deutsche Bahn Office landmark property
Slide 23: Defensive Portfolio with Strong Tenant Structure
DEFENSIVE PORTFOLIO WITH STRONG TENANT STRUCTURE -Limited dependency on single tenants due to large tenant base of over 2,700 tenants -Top 10 tenants represent less than 20% of rent -Long lease terms -Portfolio WALT as of December 2017: Office Hotel Retail Logistics/Whole Total sale/Other 4.8 years
Slide 24: Highly Performing Hotel Locations
HIGHLY PERFORMING HOTEL LOCATIONS 82 hotels by category (by value) Well diversified portfolio of branded hotels totaling €1.8 bn and 758k sqm as of December 2017 Strategic additions: -InterContinental Frankfurt center (473 Rooms) -ex-Sheraton Brussels center (533 Rooms) -Sheraton Rome (640 Rooms) -M
Slide 25: Appendix
KS sa (Garounvtown APPENDIX aa FO (iT _ 2
Slide 26: Equity Analyst Research Coverage
EQUITY ANALYST RESEARCH COVERAGE Covering Analysts Analyst Research Target Price Key index inclusions: - MDAX -Global Developed - FTSE EPRA/NAREIT -Europe Developed -Eurozone - STOXX Europe 600 -Germany - GPR 250 26 - DIMAX 26
Slide 27: Aroundtown's Share
AROUNDTOWN‘S SHARE Share performance and total return since initial placement of capital (13.7.2015) The share Frankfurt Stock Placement Exchange Shareholder structure Share issue price/volume development (Prime Standard) 13.07.2015 First equity issuance (€3.2 per share) Number of shares (basic) 1,0
Slide 28: Aroundtown's Bond Performance
AROUNDTOWN’S BOND PERFORMANCE Convertible bond Series C performance since placement (15.12.2015) Spread over mid-€-swap for straight bonds A and D, remaining 4 years Spread over mid-€-swap for straight bond F, remaining 5 years Spread over mid-€-swap for Euro Perpetual Notes 28 28
Slide 29: Strategy and Business Model
STRATEGY AND BUSINESS MODEL Quality assets STRONG CASH FLOW, QUALITY with a focus on LOCATIONS IN TOP TIER CITIES, large EU cities GROWTH POTENTIAL primarily in Germany/NL REPOSITIONING AND Healthy capital OPERATIONAL Creation Attractive IMPROVEMENTS structure with a acquisitions below strong & Cent
Slide 30: Management
MANAGEMENT CEO and CFO CEO of Aroundtown. Since 2006 in the management of Aroundtown and its subsidiaries. Previously, was the CEO of a leading international Shmuel investment conglomerate. BA in Economics and Accounting, Law and CPA. Mayo CFO of Aroundtown. Since 2008 in the management of Aroundtow
Slide 31: Office, Retail and Hotel Management Team
OFFICE, RETAIL AND HOTEL MANAGEMENT TEAM Head of commercial operations. Before joining the Group he was a board member of Strabag AG and CEO of Raiffeisen evolution, responsible for project Markus development on 11 European countries with a development volume of more than €2bn. Mr. Neurauter holds a
Slide 32: Regional Market Overview
REGIONAL MARKET OVERVIEW Hamburg ► GDP growth1: 2.4% ► Migration balance2: 0.9% Bremen ► Population density3: 2,366 per km2 ► GDP growth1 : 3.5% ► Migration balance2: 0.9% ► Population density3: 1,709 per km2 Hannover ► GDP growth (NI) 1: 2.9% NRW ► Migration balance2: 1.4% ► GDP share 2015 : 21% of
Slide 33: Germany – Growing and Strong Economy
GERMANY – GROWING AND STRONG ECONOMY German GDP Development (€ trillion) Debt/GDP 2016 Budget Surplus/Deficit 2016 Source: eurostat, forecast based on the European Commission, Spring 2017 forecast Source: Eurostat Source: eurostat Germany has a growing GDP paired with a strong budget discipline… Peo
Slide 34: German Office Market Low Supply and Strong Demand
GERMAN OFFICE MARKET LOW SUPPLY AND STRONG DEMAND… Office employment outpaces office space** Low addition of new office space** **In Top 7 **In Top 7 locations +Regional according to DG HYP: 12 locations Berlin, Munich, Frankfurt, according to Cologne, Hamburg, DG HYP: Düsseldorf, Stuttgart Hannover
Slide 35: German Office Market – Increasing Rents and Occupancy
GERMAN OFFICE MARKET …LEAD TO INCREASING RENTS AND OCCUPANCY …reducing vacancy… …across Germany… Vacancy rate Vacancy rate in % (left) Office workers in thousands (right) …putting upward pressure on rents Office prime rent per €/sqm Increase in prime rents Prime rents yoy in % (left) In €/sqm (right
Slide 36: Netherlands Office Market
NETHERLANDS OFFICE MARKET …RESULTING FROM FAVOURABLE DEVELOPMENTS Current trends show very favourable market developments… Office Employment Office take-up 2015 -> 2016 4.6% H1 2016 -> H1 2017 13% Vacant space 7.7% Passing rents* 2016 – H1 2017 2016 – H1 2017 0.1% *Excl. incentives Total Office Spac
Slide 37: Hotel Market Overview
HOTEL MARKET OVERVIEW Overnight stays across all hotel accommodation types in Germany RevPar development in Germany millions Source: Smith Travel Research (STR) Hotel operational leases yields across Europe Source: CBRE 37
Slide 38: Germany Wholesale and Logistics Benefiting from Improved Market Conditions
GERMANY WHOLESALE AND LOGISTICS BENEFITING FROM IMPROVED MARKET CONDITIONS Strong consumer climate provides strong benefits to wholesale and logistics, economic metrics such as Germany’s strong export position provide further benefits, increasing take-up …H1 2017 logistic take-up: Increasing take-up
Slide 39: Macro Fundamentals Support GCP
MACRO FUNDAMENTALS SUPPORT GCP Population development Population density 2016 Annualized growth in rent price index* (persons per sqkm) Source: destatis 2012-2015, forecast based European Commission spring 2017 forecasted grow th rates Source: destatis From 1991 to 2015 the amount of households incr
Slide 40: Hamburg Dortmund Hannover
Hamburg Dortmund Hannover Amsterdam Leipzig Frankfurt Berlin Baden-Baden Rheinsberg 40 40
Slide 41: Frankfurt Mainz Düsseldorf
Frankfurt Mainz Düsseldorf Rotterdam Nuremberg Stuttgart 41 41
Slide 42: Berlin Potsdam Munich
Potsdam Berlin Cologne Munich Amsterdam Hamburg Utrecht Munich Dresden 42 42
Slide 43: Disclaimer
DISCLAIMER IMPORTANT: This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance with applicable law, e.g. regarding national and international insider dealing rules, and must not be distribute
Slide 44: Rotterdam Frankfurt Munich
Rotterdam Frankfurt Munich Leipzig Amsterdam Berlin 44 44