Northstar Realty Europe — Investor Presentation (October 2015)
19 slides from Northstar Realty Europe's investor presentation, Oct 20, 2015
Slide 1: Forward-looking statements
2 This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements about future r
Slide 2: Spin-off Transaction Summary
3 Spin-off entity NorthStar Realty Europe Corp. (“NorthStar Realty Europe” or “NRE”) 100% spin to shareholders of NorthStar Realty Finance Corp. (NYSE: NRF) Exchange / Ticker New York Stock Exchange / NRE Distribution ratio NRF shareholders will receive 1 NRE share for every 6 NRF shares held Portfo
Slide 3: Company Highlights
4 Company Highlights Pure play pan-European predominately office REIT Positioned to capitalize on improving European macro environment Track record of sourcing attractive acquisitions through established relationships across Europe Experienced management team supported by NorthStar Asset Management
Slide 4: NRE portfolio overview
5 Portman Square House, London, U.K. Properties by Geographic Location (at cost) Condor House, London, U.K. Berges de Seine, Paris, France $2.6 billion (at cost) portfolio of predominately high quality office properties Pure play pan-European predominately office REIT(4) NRE portfolio overview (as o
Slide 5: Spin-off and acquisition timeline
On February 26, 2015, NorthStar Realty Finance (NYSE: NRF) announced plans to spin off its European real estate business, NorthStar Realty Europe Four different transactions representing $2.6 billion of acquisitions (at cost) over the last ~12 months ~$2.0 billion secured prior to quantitative easin
Slide 6: Investment Philosophy
7 Seek sustainable properties that are capable of generating recurring level of cash flow Focus on intrinsic value of properties with a long term investment perspective Primary focus on the United Kingdom, France and Germany with willingness to selectively invest in other established countries Ident
Slide 7: NRE Valuation Sensitivities
NRE Valuation Sensitivities(7) In Europe, publicly traded real estate companies continue to trade on average at a cash flow multiple of 21.5x Below valuation amounts based on a hypothetical annual CAD of $0.20 per share (prior to the 1 for 6 distribution ratio) for NRE and $135 million of projected
Slide 8: NRE's portfolio comprises assets in nine countries
NRE’s portfolio comprises 52 assets in nine countries Primarily focused on UK, France and Germany 10 No. of Properties: 9 Size (sqm): 57,921 Occupancy: 99% U.K. Germany No. of Properties: 6 Size (sqm): 95,424 Occupancy: 93% No. of Properties: 23 Size (sqm): 210,020 Occupancy: 90% France Track Record
Slide 9: Case Study: Condor House, London
Case Study: Condor House, London Investment Rationale Prime location in the City of London, United Kingdom Strong tenant demand with limited supply Liquid market with broad range of investors Significant reversionary potential to be realized through re-leasing and rent reviews Potential to enhance v
Slide 10: Case Study: Trianon Tower, Frankfurt
Case Study: Trianon Tower, Frankfurt(9) Investment Rationale Iconic office tower in CBD Frankfurt, Germany 6th tallest skyscraper in Germany Established micro location in ever improving part of CBD ~70% of rent derived from long-term leases to Deutsche Bundesbank (German central bank) and Dekabank w
Slide 11: Case Study: SEB Portfolio and Trias Portfolio
Case Study SEB Portfolio $1.3 billion Pan-European Class A office portfolio 11 properties located in seven countries Well-diversified mix of market leading tenants including BNP Paribas, Cushman&Wakefield and Ernst&Young Acquired from a German open ended fund in forced liquidation Reversionary poten
Slide 12: Our Sponsor: NorthStar Asset Management
14 NorthStar Asset Management (NYSE: NSAM) is a global asset management firm that currently manages NRF and multiple real estate investment platforms, with $24.7 billion of total assets under management NSAM will manage NorthStar Realty Europe Corp. under a long-term management contract Proven track
Slide 13: Experienced Management Team
Experienced Management Team 15 NRE Executive team Mahbod Nia Chief Executive Officer Years experience: 16 Scott A. Berry Future Chief Financial Officer Years experience: 15 Trevor K. Ross General Counsel Years experience: 14 NSAM Executive team David Hamamoto Executive Chairman Chairman of NRE board
Slide 14: European Macro Environment
16 European Macro Environment(11) All the 28 countries in the EU are forecasted to achieve GDP growth in 2015, except for Cyprus European Commission 2015 GDP growth forecast: EU: 1.8% GDP; and Eurozone: 1.5% Near-term outlook is positive due to factors including: low interest rates; ECB quantitative
Slide 15: European Investment Opportunity
European Investment Opportunity(12) 17 Spread of Prime Office Yield over 10-year Government Bonds Pan-European Sector Real Estate Values (Q4 2007 = 100) – EU 28 Source: CBRE Valuation Monitor 310 bps 441 bps -17 bps Yield Spreads At Historically Wide Levels Financing At Historically Low Cost Signifi
Slide 16: European Office Fundamentals
European Office Fundamentals(13) 18 Yields % Spread 1986 Q1 = 100 1992 2001 2007 Office fundamentals continue to strengthen across major European markets CBRE Prime Office Rents Index Declining Office Vacancy in Major European Markets Prime vs. Secondary Yields 4 5 6 7 8 9 10 2004 2005 2006 2007 200
Slide 17: Presentation Endnotes
19 Presentation Endnotes NRE portfolio excludes European healthcare properties, which will be retained by NRF. The distribution will be completed and effective by 11:59 p.m., New York Time, on October 31, 2015. Expected Annual Distribution: The actual timing and amount of distribution payments, if a
Slide 18: Presentation Endnotes
20 Presentation Endnotes 8. Asset information as of June 30, 2015 pro forma for the $621 million acquisition of the Trianon Tower in July 2015 and includes four properties representing $18 million of asset value classified as held-for-sale. 9. 6th tallest skyscraper in Germany based on the Council o
Slide 19: Presentation Endnotes
Presentation Endnotes ‘Asset information 3s of June 30, 2015 proforma fr the S621 milion acquisition ofthe Trianon Tower in July 2015 and includes four properties representing S18 milion of asset ‘ale clasifed as held-fr sale, {6th tallest skyscraper in Germany based on the Coun of Tall Building and
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