GARDA Property Group · ASX:GDF
GARDA Property — Garda Diversified Property Fund — FY2018 Earnings Presentation
38 slides from GARDA Property's earnings presentation, Aug 23, 2018
Slide 1: Full Year Results Presentation
For personal use only FULL YEAR RESULTS PRESENTATION 23 AUGUST 2018 GARDA DIVERSIFIED PROPERTY FUND (ASX CODE: GDF) ARSN 104 391 273
Slide 2: GDF at a Glance
GDF AT A GLANCE For personal use only 1 95% 5.9 YEARS 3.2% $ 0.09/unit WEIGHTED AVERAGE OCCUPANCY 2 WALE2 RENT REVIEWS FY2019 Distribution FORECAST 37.5% $1.29 6.78% ALIGNED MANAGER WEIGHTED AVERAGE GARDA Capital LVR3 NTA Per Unit CAP RATE4 holds 13.5% of GDF units 1. Based on the ‘upon completion’
Slide 3: Highlights
HIGHLIGHTS For personal use only DELIVERING IMPROVING PRUDENT CAPITAL BAL ANCED RETURNS PORTFOLIO QUALIT Y MANAGEMENT » D istributions of 9 cpu, 63.6% tax advantaged » Lease renewals and acquisitions improved » $30 million entitlement offer completed in WALE to 5.9 years and maintained a stable Dece
Slide 4: Results - Overview
RESULTS - OVERVIEW For personal use only 30 JUNE 2018 ($) 30 JUNE 2017 ($) Statutory Net Profit 24,161,000 20,121,000 Adjustments: Fair value movement of investment properties (14,330,000) (9,517,000) Loss on sale of investment properties - 154,000 Net (gain)/loss of interest rate swaps marked to ma
Slide 5: NTA Movements
NTA MOVEMENTS For personal use only $0.12 $(0.01) $1.29 $1.21 $(0.01) $(0.01) 30-June-17 Acquisition Interest rate Revaluation Other 30-June-18 Costs - Wacol swap MTM & Heathwood GARDA DIVERSIFIED PROPERTY FUND FULL YEAR RESULTS PRESENTATION 23 AUGUST 2018 | 5
Slide 6: Recent Performance
RECENT PERFORMANCE For personal use only NTA ($ PER UNIT) WALE (YEARS) $1.29 $1.21 5.9 $1.13 5.6 $1.02 4.1 3.5 2015 2016 2017 2018 2015 2016 2017 2018 CAP RATE (%) OCCUPANCY (%) 8.90% 8.13% 7.37% 95% 95% 6.78% 94% 93% 2015 2016 2017 2018 2015 2016 2017 2018 GARDA DIVERSIFIED PROPERTY FUND FULL YEAR
Slide 7: Capital Management
CAPITAL MANAGEMENT For personal use only KEY DEBT METRICS » The Fund completed a $30.0 million entitlement offer in Total debt facilities ($) 118,659,500 December 2017. » ANZ Bank recently provided new facilities of $30.65m (for Wacol Drawn debt ($) 107,159,500 and Pinkenba) complimenting exiting fa
Slide 8: Leasing Overview
LEASING OVERVIEW For personal use only » GDF has continued to address material year on year lease expiry with positive renewal outcomes. » A total of approximately 14,600m² has been leased across 13 transactions during FY18. » 5 leasing transactions for a total of 1,228m² to treat with during FY19.
Slide 9: Capital Improvements Program
CAPITAL IMPROVEMENTS PROGRAM For personal use only BOTANICCA 9 MAINTENANCE CAPEX - CAPITAL ADDITIONS - CONSTRUCTION - $0.3 million $4.8 million $20.2 million » Reinvestment into the properties continued during the financial year through the capital improvements program with $4.8 million deployed int
Slide 10: GDF v S&P/ASX A-REIT Index
GDF v S&P/ASX A-REIT 200 INDEX For personal use only GDF.ASX GDF.ASX XPJ.ASX XPJ.ASX GDF.ASX XPJ.ASX 130%130% 125%125% 120%120% 115%115% 110%110% 105%105% 100%100% 95% 95% 90% 90% 85% 85% 02 Jul 15 19 Nov 15 15 Apr 16 06 Sep 16 30 Jan 17 23 Jun 17 10 Nov 17 09 Apr 18 02 Jul 15 19 Nov 15 15 Apr 16 06
Slide 11: GDF v AREIT Peers
GDF v AREIT PEERS For personal use only FORECAST FY2019 DPU YIELD (%) WALE (YEARS) 7.3% 7.1% 6.9% 6.9 6.8% 5.9 6.5% 5.4 5.3 6.2% 5.1 4.0 CMA GDF CIP IDR GOZ IDR GDF GOZ CIP CMA PREMIUM/(DISCOUNT) TO NTA GEARING (%) 38% 16.6% 37% 34% 34% 31% 28% 3.9% 3.0% 0.0% GOZ CIP CMA CMA IDR GOZ GDF CIP GDF IDR
Slide 12: Capital Transactions - Acquisitions: Noosa Street, Heathwood
CAPITAL TRANSACTIONS - ACQUISITIONS For personal use only 67 NOOSA STREET, HEATHWOOD (QLD) » April 2018. » Acquired for $9.8m on a capitalisation rate of 7.4%. » 10 year lease in place to James Engineering, expiring in April 2028. » 6,022m² of NLA with a low 40% site coverage. » Located in a prime i
Slide 13: Capital Transactions - Acquisitions: Bivouac Place, Wacol
CAPITAL TRANSACTIONS - ACQUISITIONS For personal use only METROPLEX WESTGATE 41 BIVOUAC PL ACE, WACOL (QLD) » Settled in May 2018. » Acquired for $35.25 million on a capitalisation rate of 6.25%. » Volvo Group commenced a 10 year lease in July 2018 for their new Asia-Pacific head office and service
Slide 14: Capital Transactions - Acquisitions: Main Beach Road, Pinkenba
CAPITAL TRANSACTIONS - ACQUISITIONS For personal use only 70-82 MAIN BEACH ROAD, PINKENBA (QLD) » Settled in late June 2017 and construction completed in August 2018. » Acquired for $19.0 million on a capitalisation rate of 7.37%. » 15 year lease is in place to a subsidiary of the Byrne Group, who o
Slide 15: Under Construction - Botanicca 9: Property Overview
UNDER CONSTRUCTION – BOTANICCA 9 For personal use only PROPERT Y OVERVIEW » The property will be a five level 7,254m2 A-Grade commercial office building designed to 5 Star NABERS rating (energy). » Floor plates range from 1,200m2 to 1,500m2. » Valuation reflects net rents of $450/m2 for office. PROP
Slide 16: Under Construction - Botanicca 9: Location
UNDER CONSTRUCTION – BOTANICCA 9 For personal use only LOCATION » Only 4 kilometres from the Melbourne CBD in the highly sought after city fringe suburb of Richmond, the property forms part of the Botanicca Corporate Park. » GDF currently owns Botanicca 7, a 6,587m2 A-Grade office building located i
Slide 17: Botanicca - Project Update
BOTANICCA 9 – PROJECT UPDATE For personal use only » Basement excavation completed and first basement slab now poured. » Construction due for completion in second quarter 2019. » $ 20.2 million spent and approximately $30 million in FY19. » C ontinuing strength in the Melbourne Fringe leasing market
Slide 18: Melbourne City Fringe Market Overview
MELBOURNE CITY FRINGE MARKET OVERVIEW For personal use only SUBURBAN MARKET COMPOSITION 50.9% 29.5% 19.6% A Grade B Grade C Grade SUBURBAN PRECINCT COMPOSITION PRECINCT NLA (m²) NLA (%) City Fringe 973,900 30.6% Inner East 584,547 18.3% Outer East 890,445 28.0% South East 469,704 14.8% North & West
Slide 19: Melbourne City Fringe Market Overview - Vacancy Rates
MELBOURNE CITY FRINGE MARKET OVERVIEW For personal use only MARKET OVERVIEW - VACANCY RATES 13.1% 10.7% 7.5% 6.3% 5.9% 4.6% 3.6% 3.5% City Fringe Inner East Outer East South East North and West North and West Melbourne CBD Sydney CBD GARDA DIVERSIFIED PROPERTY FUND FULL YEAR RESULTS PRESENTATION 23
Slide 20: Melbourne City Fringe Market Overview - Future Supply
MELBOURNE CITY FRINGE MARKET OVERVIEW For personal use only FUTURE SUPPLY AND PRE-COMMITMENT 20,000 2019 2020 18,000 16,000 14,000 12,000 (m2) 10,000 8,000 6,000 4,000 2,000 Available 0 Pre Botanicca 9 9-11 Cremorne St 54 Wellington St 17 Harcourt Pde 600 Church St 57 Balmain St Botanicca 3 (Growthp
Slide 21: Objectives
OBJECTIVES For personal use only The Fund’s key objectives for H1FY19 include: Oversee the construction and leasing of Botanicca 9 which is due for completion in the second quarter of CY2019; Consider capital transactions including divestments; Continue the capital improvements program with $6.0 mil
Slide 22: At Risk Income
AT RISK INCOME For personal use only » Approximately 14,600m² renewed or leased, reducing the H1FY19 at risk income from 12% to 1%. » Near term portfolio expiry of only 2% across five lease expiries due in FY19. » Botanicca 9 is a project under construction in one of the strongest performing and tig
Slide 23: FY2019 Outlook
FY2019 OUTLOOK For personal use only » GDF will continue to seek opportunities to grow AUM in lower incentivised markets. » GDF is specifically seeking: - Industrial assets in Brisbane; - Commercial office assets in Melbourne; and - Individual asset values of $20 million - $50 million. » GDF will co
Slide 24: FY2019 Guidance
FY2019 GUIDANCE For personal use only » F Y2019 distribution guidance at $0.09 per unit paid in equal quarterly distributions. » E xpected tax advantaged income of between 60% to 70%. » A t current trading pricing of $1.261 per unit, reflects a distribution yield of 7.14%. » F ull year payout ratio
Slide 25: Appendix - Financial Information
APPENDIX 1 For personal use only FINANCIAL INFORMATION
Slide 26: Income Statement
INCOME STATEMENT For personal use only 30 JUN 2018 30 JUN 2017 » Net profit attributable to unitholders of $24.2 million, up 20.1% $000’S $000’S on the prior year. Property revenue 19,267 19,935 » The increase in net profit is primarily a result of the $14.3 million uplift in property re-valuations
Slide 27: Funds From Operations
FUNDS FROM OPERATIONS For personal use only 30 JUN 2018 30 JUN 2017 » FFO increased by $0.48 million to $11.2 million, representing $000’S $000’S a 4.5% increase on the prior year’s FFO of $10.7 million. Net profit 24,161 20,121 » F Y18 distributions increased compared to the prior period as a resul
Slide 28: Balance Sheet
BALANCE SHEET For personal use only 30 JUN 2018 30 JUN 2017 » F Y18 total assets increased to $290.6 million, representing a 44.8% increase on the $000’S $000’S FY17 balance of $200.6 million. Assets » Investment properties increased to $283.9 million due to the net effect of: Cash and cash equivale
Slide 29: GDF Portfolio
For personal use only GDF PORTFOLIO
Slide 30: $327m Portfolio Upon Completion
$327m PORTFOLIO UPON COMPLETION For personal use only PORTFOLIO VALUE (BY SECTOR) COMMERCIAL 68% INDUSTRIAL 32% PORTFOLIO VALUE (BY LOCATION) 44% 27% 16% 9% 4% 7-19 Lake Street, Cairns ($51.0m) 69-79 Diesel Drive, Mackay ($30.2m) 747 Lytton Road, Murarrie ($14.3m) 142 Benjamin Place, Lytton ($9.7m)
Slide 31: Property Portfolio
PROPERTY PORTFOLIO For personal use only INDEPENDENT PORTFOLIO PROPERTY PORTFOLIO TYPE CAP RATE (%) NLA (m2) WALE5 OCCUPANCY5 NABERS VALUATION¹ ($m) VALUE (%) 588 Swan Street, Richmond, VIC Office 62.5 2 5.75% 7,252 N/A N/A 5.0 19% 572-576 Swan Street, Richmond, VIC Office 52.5 5.75% 6,587 5.4 100%
Slide 32: Portfolio Summary - Property
PORTFOLIO SUMMARY – PROPERTY For personal use only 41 BIVOUAC PL ACE, WACOL , 70-82 MAIN BEACH ROAD, QLD PINKENBA , QLD Cap Rate 6.25% Occupancy 100% Cap Rate 7.4% Occupancy 100% Independent Valuation $35,250,000 WALE 10.0 years Independent Valuation $19,000,000 WALE 15.0 years Ownership interest 10
Slide 33: Portfolio Summary - Property
PORTFOLIO SUMMARY – PROPERTY For personal use only 69-79 DIESEL DRIVE, MACKAY, 142 BENJAMIN PL ACE, LY TTON, QLD QLD Cap Rate 7.50% Occupancy 100% Cap Rate 7.00% Occupancy 100% Independent Valuation $30,200,000 WALE 10.5 years Independent Valuation $9,700,000 WALE 1.7 years Ownership interest 100% T
Slide 34: Portfolio Summary - Property
PORTFOLIO SUMMARY – PROPERTY For personal use only 67 NOOSA STREET, 7-19 L AKE STREET, CAIRNS, QLD HEATHWOOD, QLD Cap Rate 7.4% Occupancy 100% Cap Rate 8.25% Occupancy 94% Independent Valuation $9,800,000 WALE 9.7 years Independent Valuation $51,000,000 WALE 3.4 years Ownership interest 100% Tenants
Slide 35: Portfolio Summary - Property
PORTFOLIO SUMMARY – PROPERTY For personal use only 572 - 576 SWAN STREET, 436 ELGAR ROAD, BOX HILL , VIC RICHMOND, VIC Cap Rate 5.75% Occupancy 100% Cap Rate 6.25% Occupancy 100% Independent Valuation $52,500,000 WALE 5.4 years Independent Valuation $29,000,000 WALE 2.7 years Ownership interest 100%
Slide 36: Portfolio Summary - Property
PORTFOLIO SUMMARY – PROPERTY For personal use only 747 LY TTON ROAD, MURARRIE, 154 VARSIT Y PDE, QLD GOLD COAST, QLD Cap Rate 8.00% Occupancy 73% Cap Rate 8.25% Occupancy 90% Independent Valuation $14,250,000 WALE 2.9 years Independent Valuation $14,000,000 WALE 3.4 years Ownership interest 100% Ten
Slide 37: Disclaimer
DISCLAIMER This presentation (Presentation) has been prepared on behalf of GARDA Capital Limited (ACN 095 039 366) (AFSL 246714) (GARDA) as responsible entity of the GARDA For personal use only Diversified Property Fund ARSN 104 391 273 (GDF or the Fund). The information and statements in this Prese
Slide 38: Garda Diversified Property Fund (ASX Code: GDF)
For personal use only GARDA DIVERSIFIED PROPERTY FUND (ASX CODE: GDF)
Garda Diversified Property Fund — FY2018 Earnings Presentation on 6ix