Slide 1: Investor and Analyst Presentation: Interim Results
WORKSPACE INVESTOR AND ANALYST PRESENTATION 11 NOVEMBER 2015 INTERIM RESULTS DELIVERING GROWTH THROUGH ACTIVE MANAGEMENT
Slide 2: The Right Strategy
WORKSPACE THE RIGHT STRATEGY Right market London is growing and changing Right Right brand properties Increasing Creating recognition and modern growth reputation WORKSPACE environments UNDERSTANDS WORK SPACE Right Right people customers Driving New and performance growing companies Home to new and
Slide 3: Agenda
AGENDA WORKSPACE Jamie Hopkins Chief Executive Officer PERFORMANCE Graham Clemett Chief Financial Officer DIRECTION Jamie Hopkins Chief Executive Officer QUESTIONS 3
Slide 4: Results
WORKSPACE RESULTS September March Change Active Management 2015 2015 Rent Roll (lfl) £49.7m £45.7m 8.8% Rent per sq. ft. (lfl) £20.68 £18.61 11.1% Enquiries (per month) 1,027 1,222 (16.0)% Occupancy (lfl) 90.9% 92.2% (1.3)% Property Valuation £1,631m £1,423m 9.6%* Capital Value per sq. ft. (lfl) £31
Slide 5: Income Statement
PERFORMANCE INCOME STATEMENT September September Change £m 2015 2014 Net Rental Income 35.9 27.9 +29% Joint Venture Income 0.5 0.5 – Administrative Expenses (7.6) (6.7) +13% Net Finance Costs (8.4) (9.3) (10)% Trading Profit after Interest 20.4 12.4 +65% Revaluation Surplus 137.9 143.5 (4)% Other it
Slide 6: Net Rental Income
PERFORMANCE NET RENTAL INCOME £40m 40 1.6 (0.9) 35.9 3.6 (0.1) £35m 35 3.8 £30m 30 27.9 £25m 25 £20m 20 Sep 2014 Like-for-like Completed Completed Projects Projects Projects Underway Acquisitions Disposals Sep 2015 Projects Underway 6
Slide 7: Like-for-Like Properties
PERFORMANCE LIKE-FOR-LIKE PROPERTIES RENT ROLL OCCUPANCY £55.0m 100% 95% 92.9% 92.2% +4.0% 90.9% 90.6% 90.9% £50.0m +4.5% 90% +3.8% 85% £45.0m +6.3% 80% +2.0% Sep 14 Dec 14 Mar 15 Jun 15 Sep 15 £40.0m RENT PER SQ. FT. £22.0 +4.6% +6.2% £35.0m £20.0 +3.6% +4.6% £18.0 +2.8% £16.0 £30.0m £14.0 £12.0 £1
Slide 8: Completed Projects
PERFORMANCE COMPLETED PROJECTS REFURBISHMENTS REDEVELOPMENTS Rent Rent Roll Roll £13.3m £14m £4m £11.7m £3.2m £12m £2.8m £10m £3m £8.6m £2.1m £8m £5.7m £2m £6m £1.2m £4m £1m £2m £0m £0m Sep 2014 Mar 2015 Sep 2015 ----------------- Future Sep 2014 Mar 2015 Sep 2015 ----------------- Future • 5 refurb
Slide 9: Projects Underway
PERFORMANCE PROJECTS UNDERWAY REFURBISHMENTS REDEVELOPMENTS Rent Rent Roll Roll £15.6m £4m £3.8m £16m £3m £12m £2m £8m £4.8m £5.0m £4.8m £0.9m £4m £1m £0.3m £0.3m £0m £0m Sep 2014 Mar 2015 Sep 2015 ----------------- Future Sep 2014 Mar 2015 Sep 2015 ----------------- Future • 7 projects underway (£1
Slide 10: Cash Flow
PERFORMANCE CASH FLOW £m Trading Net Cash from Operations 18 6 Dividends Paid (12) Investment Capital Expenditure (27) Property Acquisitions (58) Property Disposals 1 (63) Capital Receipts 14 Distributions from Joint Ventures 7 Net Movement in year (57) Net Debt at March 2015 (270) Net Debt at Septe
Slide 11: Balance Sheet
PERFORMANCE BALANCE SHEET September March £m 2015 2015 Investment Property Valuation 1,631 1,423 Investment in Joint Ventures 21 29 Net Debt (327) (270) Other (26) (36) Net Assets 1,299 1,146 EPRA NAV (per share) £7.92 £7.03 Loan to Value 20% 19% Facility Headroom £83m £140m 11
Slide 12: Property Valuation
PERFORMANCE PROPERTY VALUATION £m 1,800 1,700 1,631 143 1,600 54 1,500 27 1,423 (1) (15) 1,400 1,300 1,200 1,100 1,000 Mar 2015 Property Capital Capex Acquisitions Revaluation Sep 2015 Disposals Receipts Uplift 12
Slide 13: Revaluation Uplift
PERFORMANCE REVALUATION UPLIFT £m Uplift Main movements Pricing £60m (94%) Like-for-like 64 Yield £4m (6%) Metal Box Factory £12m Completed Projects 33 The Light Bulb £8m Cargo Works £4m Residential Consents £20m Redevelopments 31 New Business Space £6m Overage £5m The Print Rooms £3m Refurbishments
Slide 14: Debt Analysis
PERFORMANCE DEBT ANALYSIS September 2015 March 2015 Net Debt £327m £270m Total Facilities (all unsecured) £410m £410m Hedged/Fixed Rate Facilities 50% 73% Interest Cost (*exit rate) 4.8%* 5.4% Average Period to Maturity 6.0 years 5.8 years FACILITIES BY TYPE MATURITY PROFILE £m 250 200 Private Bank
Slide 15: The Right Strategy
DIRECTION THE RIGHT STRATEGY Right market London is growing and changing Right Right brand properties Increasing Creating recognition and modern growth reputation WORKSPACE environments UNDERSTANDS WORK SPACE Right Right people customers Driving New and performance growing companies Home to new and
Slide 16: Property Portfolio
DIRECTION PROPERTY PORTFOLIO Workspace property Crossrail Northern Line Extension ISLINGTON KING’S CROSS SHOREDITCH BETHNAL GREEN OLD STRATFORD STREET PADDINGTON FARRINGDON WEST END THE CITY LONDON BRIDGE CANARY WHARF WATERLOO VICTORIA EARLS COURT KENNINGTON BATTERSEA 16
Slide 17: Customer Portfolio
DIRECTION CUSTOMER PORTFOLIO Workspace property Crossrail Northern Line Extension 17
Slide 18: Property Portfolio
DIRECTION PROPERTY PORTFOLIO Right properties Creating modern growth WORKSPACE environments UNDERSTANDS WORK SPACE 18
Slide 19: Property Portfolio: Mix by Rent Roll
DIRECTION PROPERTY PORTFOLIO PORTFOLIO MIX BY RENT ROLL RENT PER SQ. FT. (lfl) 10% £30.0 Industrial 44% +11.0% £25.0 +8.1% +8.3% £20.0 90% £15.0 £10.0 +3.5% +7.6% +2.1% Business Centre 56% £5.0 £0.0 Mar 07 Sep 15 H1 14/15 H2 14/15 H1 15/16 Business Centres Industrials 19
Slide 20: Rent per Sq. Ft. by Property
DIRECTION PROPERTY PORTFOLIO RENT PER SQ. FT. BY PROPERTY (lfl) £90 EXMOUTH £80 HOUSE £70 PALL £60 MALL £50 ATLAS £40 £30 £20 £10 £0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 20
Slide 21: Disposal: Leyton Industrial Village
DIRECTION DISPOSAL RATIONALE • 135,500 sq. ft. industrial estate • Successful repositioning • Strong interest from potential buyers • Opportune market timing FINANCIALS • £23m • 4.8% net initial yield • 25% premium to March 2015 valuation LEYTON INDUSTRIAL VILLAGE LEYTON 21
Slide 22: Acquisition: Alexandra House
DIRECTION ACQUISITION PICTURE TO COME ALEXANDRA HOUSE WOOD GREEN 22
Slide 23: Acquisition: Alexandra House, Wood Green
DIRECTION ACQUISITION ALEXANDRA HOUSE WOOD GREEN RATIONALE FINANCIALS Off market deal Opportunistic £14m £255 per sq. ft. capital value Wood Green location Infrastructure investment £10 per sq. ft. Good strategic fit Chocolate Factory cluster 3.7% net initial yield Let to Haringey Rent review in Cou
Slide 24: Acquisition: Cannon Wharf
DIRECTION ACQUISITION CANNON WHARF SURREY QUAYS 24
Slide 25: Acquisition: Cannon Wharf, Surrey Quays
DIRECTION ACQUISITION CANNON WHARF SURREY QUAYS RATIONALE FINANCIALS Limited marketing Opportunistic £10.4m £310 per sq. ft. capital value Acquired from Part of wider Barratt Homes redevelopment Target £25 per sq. ft. New build Design fit Strategic location Area of regeneration Cluster efficiencies
Slide 26: Customer Portfolio
DIRECTION CUSTOMER PORTFOLIO WORKSPACE UNDERSTANDS WORK SPACE Right customers New and growing companies 26
Slide 27: Customer Portfolio
DIRECTION CUSTOMER PORTFOLIO 27
Slide 28: Customer Portfolio: Business Categories
DIRECTION CUSTOMER PORTFOLIO BUSINESS CATEGORIES % Net Rent % Net Rent 1 Marketing 8.62 31 Quantity Surveyors 1.07 2 Business Consultancy 6.62 32 Travel 1.01 3 Architect 5.50 33 Professional Development 1.00 4 Finance 4.83 34 Broadcasting 0.97 5 Brand Design 4.38 35 Associations/Societies 0.80 4% 6
Slide 29: Customer Portfolio
DIRECTION CUSTOMER PORTFOLIO Alternative Finance Accountants Courses Distribution Venture Capital Insurance Financing Makers & Private Equity FINANC ILM Peer Webcast/ to Peer E-Finance Webinar Documentary Lending Financial E-Payments Video Production Solutions for TV & Post Production Advertising 54
Slide 30: Outlook
DIRECTION OUTLOOK Right market London is growing and changing Right Right brand properties Increasing Creating recognition and modern growth reputation WORKSPACE environments UNDERSTANDS WORK SPACE Right Right people customers Driving New and performance growing companies Home to new and growing com
Slide 31: Questions
QUESTIONS QUESTIONS QUESTIONS 31 31
Slide 32: Supplementary Information
SUPPLEMENTARY INFORMATION 32
Slide 33: Appendix 1: Redevelopment Projects
APPENDIX 1 REDEVELOPMENT PROJECTS September Development 2015 Rent Expected Residential At September 2015 partner Valuation Roll completion units no. Commercial space returned Other proceeds Estimated Estimated Cash Cash Overage to Area ERV Rent* received to come come ** Completed ScreenWorks Taylor
Slide 34: Appendix 2: Refurbishment Projects
APPENDIX 2 REFURBISHMENT PROJECTS Actual/ Estimated Estimated Estimated Cost to Estimated Unaffected Upgraded New ERV Rent at 90% September 2015 At September 2015 Valuation cost Complete Completion area area space (Average) occupancy * Rent Roll * Completed Leyton Industrial Village (phase 1) £16m £
Slide 35: Appendix 3: Angel House, Islington
APPENDIX 3 ANGEL HOUSE ANGEL HOUSE ISLINGTON ISLINGTON 35
Slide 36: Appendix 4: Angel House, Islington
APPENDIX 4 ANGEL HOUSE ISLINGTON MECCA BINGO Riverside Mecca Bingo WANDSWORTH 36
Slide 37: Appendix 5: How We Make Money
APPENDIX 5 HOW WE MAKE MONEY WHAT UNDERSTANDING CREATING THE RIGHT WE DO DEMAND SUPPLY STRATEGY MARKET LONDON KNOWLEDGE REVENUE THE RIGHT PROPERTIES + + NEW AND GROWING CUSTOMER + GROWTH RELATIONSHIPS COMPANIES THE RIGHT + + SERVICES CAPITAL TAILORED BUSINESS OPERATIONAL ENVIRONMENTS CAPABILITY 37
Slide 38: Disclaimer
DISCLAIMER The information in this document may include forward-looking statements, which are based on current expectations and projections about future events. These forward‑looking statements reflect the directors' beliefs and expectations and are subject to risks, uncertainties and assumptions ab