Slide 1: 2016 Annual Result
For personal use only 2016 ANNUAL RESULT 14 February 2017
Slide 2: Agenda
For personal use only SECTION SPEAKER AGENDA 2016 Annual Result Highlights Bob Johnston Finance & Capital Management Anastasia Clarke Retail Vanessa Orth Office & Logistics Matthew Faddy Funds Management Nicholas Harris Summary & Outlook Bob Johnston
Slide 3: 2016 Annual Result Highlights
2016 Annual Result Highlights For personal use only • FFO growth and Distribution growth in line with guidance 5.6% 4.0% • Total Return of 15.5% FFO growth Distribution growth per security per security • Debt maturity profile lengthened across a diversified investor base • GWOF terms renewed • Acqui
Slide 4: 2016 Business Outcomes: Investment Portfolio & Operations
2016 Business Outcomes For personal use only INVESTMENT PORTFOLIO & OPERATIONS • Like for like income growth 4.5% 4.5% $612M Portfolio like for like Total valuation • Occupancy maintained at >95% growth uplift • Asset recycling to improve quality − Dandenong sale − Divestment of Kings Park • Continu
Slide 5: 2016 Business Outcomes: Development
2016 Business Outcomes For personal use only DEVELOPMENT • Performance of completed development projects in line with investment case − Casuarina Leisure & Entertainment − Charlestown remix • Current developments tracking in line with program and budget • Development pipeline enhanced − Parramatta o
Slide 6: Finance
For personal use only FINANCE
Slide 7: Financial Summary
Financial Summary For personal use only 12 MONTHS TO 31 DECEMBER ($ MILLION) 2016 2015 CHANGE Net Profit After Tax 1,152.7 868.1 32.8% Deduct: Valuation increases 611.6 432.1 Deduct: Distribution on exchangeable securities - 1.7 Add back: Treasury items marked to market 23.0 74.0 Deduct: Other items
Slide 8: Segment Result
Segment Result For personal use only 12 MONTHS TO 31 DECEMBER ($ MILLION) 2016 2015 CHANGE Retail 294.1 295.5 Office 225.0 210.5 Logistics 95.4 94.6 Funds Management 61.0 44.6 Net Income 675.5 645.2 4.7% Net interest expense (100.0) (117.6) Corporate overheads (29.8) (33.1) Tax expense (14.0) (4.9)
Slide 9: Capital Management
Capital Management For personal use only • Reduced weighted average cost of debt by 35bps to 4.25% • Upgrade of GPT’s long term rating with Standard and Poor’s to A Dec 2016 Dec 2015 Change Net tangible assets per security $4.59 $4.17 9.9% Net gearing1 23.7% 24.8% (110) bps Weighted average cost of
Slide 10: Capital Management: Debt Sources and Maturity Profile
Capital Management For personal use only • Debt capital market issuance of $600m in 2016 providing greater diversification of funding sources • Weighted average debt term increased to 6.5 years with a staggered maturity profile • Strong liquidity position with $786m of cash and available undrawn fac
Slide 11: Retail
For personal use only RETAIL
Slide 12: Retail Highlights
Retail Highlights Key Portfolio Statistics For personal use only 3.8% 2.6% $11,036 99.6% $230.8m 5.39% Portfolio like for Specialty sales Specialty sales Total portfolio Valuation Weighted like income MAT growth productivity occupancy uplift average cap growth per sqm rate • Total Portfolio Return o
Slide 13: Retail Valuations
Retail Valuations • Total valuation gain of $230.8m For personal use only • Strong valuation gains driven by outperformance on key assets • Annual cap rate compression of 19bps to 5.39% VALUATION UPLIFT 2016 (MILLION) PROPERTY VALUATION UPLIFT CHANGE Melbourne Central $1,274.0 $129.1 11.4% Westfield
Slide 14: Retail Sales
Retail Sales • Proactive investment decisions improving portfolio composition and For personal use only asset quality • Strategic capital investment in development pipeline has contributed to productivity growth • Active asset management focused on remixing into growth retail categories Specialty Sa
Slide 15: Retail Sales
Retail Sales • Introduction of domestic and international mini major retailers has driven category outperformance For personal use only • Remixing strategy has contributed to strong productivity growth • Focusing apparel offer to sector leading retailers has delivered apparel productivity growth of
Slide 16: Retail Leasing
Retail Leasing • Retailer demand remains strong for highly productive assets contributing to an improvement in leasing metrics For personal use only • Investment in the shopper experience bringing first to market and new retail concepts into the portfolio • Portfolio continues to deliver strong spec
Slide 17: Retail Development
Retail Development Sunshine Plaza For personal use only • $400m retail expansion (100% interest) • Development underway, targeting completion in Q4 2018 • All major tenants committed • Specialty leasing program to commence in Q1 2017 • Commencement of new retail mall in Q2 2017 • New carpark (700 sp
Slide 18: Retail Market Outlook
Retail Market Outlook RETAIL RETAIL GPT For personal use only SALES LEASING PORTFOLIO Portfolio • Moderation in retail sales • Demand for space in highly • 85% of our portfolio expected to growth productive assets remains positioned in the growth deliver strong markets of NSW and Victoria • The ‘wea
Slide 19: Office
YEN AK IM X OOP OFFICE The GPT Group
Slide 20: Office Highlights
Office Highlights Key Portfolio Statistics For personal use only 6.3% $ 336.5m 97.0% 135,100m2 5.55% 5.5yrs Portfolio like for Valuation Total portfolio Leases Weighted Office like income uplift occupancy signed average cap WALE growth rate • Total Portfolio Return of 15.3% OFFICE • Strong leasing r
Slide 21: Office Valuations
Office Valuations • Total annual valuation gain of $336.5m WEIGHTED AVERAGE VALUATION UPLIFT For personal use only • Valuation gains driven by a combination of income growth and firming metrics Sydney Melbourne Brisbane +11.8% +6.6% +2.6% • Annual cap rate compression of 39bps to 5.55% VALUATION UPL
Slide 22: Office Leasing
Office Leasing • Portfolio occupancy increased to 97.0% For personal use only • 135,150sqm of signed leases and 34,750sqm of deals at Heads of Agreement • IAG lease renewal at CBW in Melbourne • Effective rent growth of over 20% in Sydney driven by strong growth in face rents and a reduction in ince
Slide 23: Sydney Olympic Park Pre-Commitment
Sydney Olympic Park Pre-Commitment For personal use only 4 Murray Rose Avenue, Sydney Olympic Park • 15,700sqm of A-Grade office accommodation • 60% pre-commitment (9,300sqm) to Government Property NSW for the NSW Rural Fire Service for 12 year term • Expected completion date 2H 2018 • Value on comp
Slide 24: Parramatta Site Acquisition
Parramatta Site Acquisition • Prime corner site of 2,400sqm in the heart of Parramatta’s core commercial For personal use only precinct • Acquired in December 2016 for $31.2m with settlement to occur in March 2017 • 26,000sqm of A-Grade office accommodation • Subject to pre-commitment, construction
Slide 25: Office Market Outlook
Office Market Outlook • Sydney to continue to deliver strong effective rental growth, with withdrawals exceeding supply For personal use only additions from 2017 to 2019 • Melbourne recorded high demand in 2016 with prime net absorption of 168,000sqm. With limited new supply over the next three year
Slide 26: Logistics
For personal use only LOGISTICS
Slide 27: Logistics Highlights
Logistics Highlights Key Portfolio Statistics For personal use only 1.4% $ 38.9m 95.3% 78,800m 2 6.54% 7.9yrs Portfolio like for Valuation Total portfolio Leases Weighted Logistics like income uplift occupancy signed average cap WALE growth rate • Total Portfolio Return of 10.8% LOGISTICS • Strong l
Slide 28: Logistics Leasing
Logistics Leasing • 78,800sqm of signed leases and 49,000sqm of deals at Heads of Agreement For personal use only • 2017 expiry reduced from 18% in 2015 to 4% • Leasing activity led by retail distribution GPT Logistics Expiry - 2017 GPT Leasing Deals By Industry Other 20% 10% 18% Manufacturing Retai
Slide 29: Logistics Development
Logistics Development For personal use only Huntingwood Drive, Sydney Abbott Road, Seven Hills • Four sites acquired in Sydney at Eastern Creek, Erskine Park and Huntingwood totalling 21.7 hectares • Construction underway for the delivery of $125m of investment assets in 2017 • Leasing progressing w
Slide 30: Logistics Market Outlook
Logistics Market Outlook • Sydney demand recorded the highest take-up in almost 20 years with the market benefiting from government infrastructure spending and tightly held land supply For personal use only • Melbourne demand remained strong in 2016, however competitive supply conditions and elevate
Slide 31: Funds Management
For personal use only FUNDS MANAGEMENT
Slide 32: GPT Funds Management Return
Funds Management GPT Funds Management Return For personal use only 12 months to 31 December 2016 • The Funds Management business delivered a strong Total Return of 17.9% for the year 3.8% 17.9% • Strong demand for units from existing and new investors 8.4% across both Funds • GPT Wholesale Office Fu
Slide 33: GPT Wholesale Office Fund
GPT Wholesale Office Fund For personal use only • The Fund delivered a strong Total Return of 14.5% for the year • Fund terms successfully renewed − Increase in base management fee to 50bps (up to $6b AUM) − Sharing of pipeline rights for both established assets and developments − Removal of perform
Slide 34: GPT Wholesale Shopping Centre Fund
GPT Wholesale Shopping Centre Fund For personal use only • Significant improvement in performance, with the Fund delivering a strong Total Return of 11.5% for the year • Review of Fund terms well underway, proposing: − No change to the base management fee − Removal of performance fee structure − All
Slide 35: Summary & Outlook
Summary & Outlook For personal use only • High occupancy and fixed rental • Retail development completions increases underpin portfolio income in FY16 to provide full year benefit in FY17 • AFFO expected to grow faster • Office expiry profile presents than FFO in near term opportunity to capture gro
Slide 36: Disclaimer
Disclaimer For personal use only The information provided in this presentation has been prepared by The GPT Group comprising GPT RE Limited (ACN 107 426 504) AFSL (286511), as responsible entity of the General Property Trust, and GPT Management Holdings Limited (ACN 113 510 188). The information pro