Slide 1: ASX release: 2021 Annual results presentation and property synopsis
Dexus (ASX: DXS) ASX release 17 August 2021 2021 Annual results presentation and property synopsis Dexus releases its 2021 Annual Results Presentation. An investor conference call will be webcast at 9.30am today on www.dexus.com/investor-centre The 2021 property synopsis excel workbook is also avail
Slide 2: Annual Results Presentation 2021
Annual Results Presentation 2021
Slide 3: 2021 Annual Results Presentation
dexus 2021 Annual Results Presentation 17 August 2021 Dexus Funds Management Limited ABN 24 060 920 783 AFSL 238163 as responsible entity for Dexus
Slide 4: Acknowledgement of Country
dexus Acknowledgement of Country As an owner, manager and developer of real estate across Australia, Dexus acknowledges the Traditional Custodians of the lands on which we operate. We recognise their ongoing connection to land, waters and community, and pay our respects to First Nations Elders past,
Slide 5: Agenda and presenters
dexus Darren Steinberg, CEO Financial results Alison Harrop, CFO Funds management Deborah Coakley, EGM Funds Management ‘ Office portfolio Kevin George, EGM Office { Industrial portfolio Stewart Hutcheon, EGM Industrial, Retail & Healthcare Investments and Developments Ross Du Vernet, ClO # Summary
Slide 6: Delivering in a complex operating environment
dexus Delivering in a complex operating environment » Growing and diversifying the funds management business FUM grew by $9.5 billion in FY21 » Maintaining high occupancy levels through strong leasing, reinforcing the resilience of the portfolio » Undertaking $6.4 billion of property transactions ac
Slide 7: FY21 highlights
dexus FY21 highlights Key achievements across the group FY21 highlights Investments & Developments Funds Management Property portfolio 1 j 8 I : 43.0% 8.3% | Dexus Wholesale Property Fund | 195ksam of office i / AS $6.4bn' i +43 eeee lorem ‘ww | outperformed benchmark over, _—_‘([easing’success | Gr
Slide 8: Strategy
dexus Strategy Revised strategic objectives to guide next stage of business evolution » Actions have been navigating us toward a more capital efficient, multi-sector real estate platform Purpose To create spaces where people thrive Strategy be globally recognised as Australia’s leading real estate c
Slide 9: Delivering on strategic objectives
dexus Delivering on strategic objectives New acauisitions and growth in funds management platform Strategic objective Strategic objective Sustainable income streams Real estate investment partner of choice +$9.5 billion! growth in funds under management during FY21 DWPF. dexus APN | Property Group d
Slide 10: Environmental, Social & Governance highlights
dexus Environmental, Social & Governance highlights Achievements across Sustainability Approach value creation outcomes Tring people >» Contributed $1.27 billion Gross Value Added to the Australian economy >» +43 employee NPS reinforces strong engagement econ and supported 7,980 construction jobs >
Slide 11: Financial results
ii wo ° <j Ladi ‘ea a
Slide 12: Key earnings drivers and valuations
dexus Key earnings drivers and valuations Valuation uplifts reinforce quality of portfolio Key earnings driver: Property portfolio valuatio: Earnings driver FY21 result 30 Jun 2021 Valuation Capitalisation rate Property y value’ movement® 12-month movement portfolio Total gi7tbn—— $584.0m 4.91% port
Slide 13: FY21 financial results
FY21 financial results Achieved 3% distribution growth despite challenging market and divestments dexus » Office property FFO reduced primarily due to the impact of divestments, -— re Fv20 Change alongside rent relief and provisions associated with COVID-19. This was partly m $m % 4 offset by income
Slide 14: COVID-19 impacts
COVID-19 impacts Rent collections of 98.1% for FY21 FY21 Rent collections » Strong cash collection while ensuring the viability of small business customer base dexus Rent collections? Office Industrial Total » Reached in principle agreement across circa 96% of rent relief 97.9% 99.0% 98.1% requests
Slide 15: Strong financial position
Strong financial position Capacity to fund growth opportunities » Gearing of 26.7%" remains below the 30-40% target range » Purchased circa 15.6 million securities via the on-market securities buy-back program in FY21 » Simplified corporate structure approved by Securityholders and recommended by th
Slide 16: Funds management
Slide 17: Funds management
dexus Funds management Delivering for our third party capital partners » High standard of corporate governance Diversified Funds management business » Strong track record of performance, with: - DWPF outperforming over 3, 5, 7 and 10 years - DHPF delivering a 18.1% one-year return Real estate iti .
Slide 18: Funds management
dexus Funds management Investor diversification and sentiment Large diversified investor base’ From Australia and offshore’ Investor insights Super Funds >» Attractiveness of Australia as an investment destination SI% Australia 1% >» Significant interest from offshore investors » Significant interes
Slide 19: FY12 FY20 FY21
30 25 20 15 10 5 0 FY12 FY20 FY21 Wholesale pooled funds Listed REITs Joint ventures Real estate securities
Slide 20: Funds management
dexus Funds management Diversified management business across 20 vehicles e TARONGA Lb Taronga Ventures Partnership DWPE dexus || DHPF | dexus || DREPT dexus | | apnipipeni croup Dexus Wholesale Dexus Healthcare Dexus Real Estate APN Property Group Property Fund Property Fund Partnership exus |, sta
Slide 21: Office portfolio
Slide 22: Business Confidence
30 80 150 70 100 10 50 60 0 -10 50 -50 -30 40 -100 30 -150 Business Confidence -50 -200 Professional job adverts (right axis) 20 -250 -70 10 Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Lockdown All industries Financial
Slide 23: Office customer insights
Office customer insights Positive indicators for leasing prior to latest lockdowns Dexus annual office customer survey insights dexus 54% Response rate +49 Office customer NPS FY20: +47 53% Intend to increase staff numbers (only 6% intend to reduce) 20% Need more space (only 11% need 2 77% Wish to w
Slide 24: Dexus's product offering to meet increased flexibility
dexus Dexus’s product offering to meet increased flexibility Expect demand for more collaboration spaces Workspace solutions from 1 hour to 10 years litte inn | 1 Traditional spaces Fitted spaces Flexible spaces Meeting spaces 7 years+ 2 years+ 6 months + Thour+ Dominant portfolio offering. Fully fi
Slide 25: Office portfolio performance
Office portfolio performance High quality portfolio attracting solid leasing across key CBDs $26.0 billion $14.0 billion Dexus balance sheet office portfolio Leased by area! 184,029sqm FY20: 88,467sqm Average incentives! 24.9% FY20: 17.1% Occupancy 95.2% FY20: 96.5% WALE 4.6 years FY20: 4.2 years Ef
Slide 26: Staggered expiry profile and diversified tenant base
1 dexus Staggered expiry profile and diversified tenant base Dexus office portfolio well placed Dexus office portfolio lease expiry profile (by income)! Diversified tenant base with limited concentration risk m™ Sydney = Melbourne Brisbane m= Perth Top customer 25% Victoria State Government represen
Slide 27: Leasing observations
Leasing observations dexus Well positioned for flight to quality and centralisation Prime grade assets represent 94% of Dexus office portfolio! Net absorption of space by grade in the past 5 years (4 major CBDs’) ‘000 sqm S00 400 BL awe Flight to quality ae 200 ~ ° — -100 -200 -300 -400 Premium C-Gr
Slide 28: Industrial portfolio
= eee 17 August 2021
Slide 29: Industrial portfolio performance
Industrial portfolio performance Exceptional year of leasing activity $7.8 billion rial properties 2.6 million 1. Includes development leasing of 244 S86sqrm, $3.0 billion Dexus balance sheet industrial portfolio Leased by area! 445,428sqm FY20: 181,472sqm Occupancy 97.7% FY20: 95.6% Average incenti
Slide 30: East Coast Industrial Take-Up and Online Penetration
East Coast Industrial Take-Up Online Penetration › 3.5 14% › 3.0 12% › 2.5 10% › 2.0 8% › 1.5 6% 1.0 4% 0.5 2% › › › 0.0 0% › › Jun-11 Jun-13 Jun-15 Jun-17 Jun-19 Jun-21 › ›
Slide 31: Investments and developments
| : ‘A a ay Ry “thvestments - and d devélopi
Slide 32: Transactions
dexus Transactions Redeploying capital into higher return opportunities $3.2 billion group divestments 60 Miller Street! Sale proceeds $273m Sale proceeds $925m 10 Eagle Street 4S Clarence Street Sale proceeds $285m — Sale proceeds $530m ‘eet, North Sydney settled to settle in the fist half of 30 |
Slide 33: Developments
dexus Developments $14.6 billion pipeline includes expanded city-shaping pipeline EE ji Brisbane 60 Collins Street, Melbourne Melbourne Pitt & Bridge Precinct, Sydne' Atlassian, Sydney Central Place Sydney 1. Group share in project cost including cost of land where purchased for development and excl
Slide 34: Developments
dexus Developments Remainder of $14.6 billion pipeline is diversified across sectors Uncommitted and concept (ex city shaping) $3.9bn! (Dexus share $2.3bn) Other key projects Healthcare Industrial Horizon 3023, Ravenhall (uncommitted) Spring Hill Medical Centre & Herston car park Minimal upfront cap
Slide 35: Consistent delivery of trading profits over time
dexus Consistent delivery of trading profits over time Replenishment of pipeline underway » Delivered $50.4 million of FY21 trading profits (post tax) across four trading projects » Three new opportunities within existing portfolio identified to replenish the pipeline » Secured trading profits for F
Slide 36: Investment strategy
Investment strategy Delivering enhanced returns from core Australian real estate 5-6% 1Oyr IRR ‘mia High quality core real estate Core 80-90% Fund management through the cycle investing management fees Target returns from core assets JOyr IRR investing alongside Dexus : et >12% unlevered Develop to
Slide 37: Summary
TER JERE
Slide 38: FY20 FY21
› › $30 $25 › $20 › $15 › › $10 $5 › $0 FY20 FY21 › › Office Industrial Retail Healthcare › Real estate securities
Slide 39: Summary
Summary Well positioned for uncertain operating environment 7 The continuing cycle of lockdowns will have an impact on business and consumer confidence, and we are preparing for this environment Demonstrated ability to capitalise on opportunities while also being able to address challenges Ability t
Slide 40: Appendices
dexus Appendices 38 Dexus 2021 Annual Results Presentation
Slide 41: Dexus today
dexus Dexus today $425 billion! - total funds under management Dexus portfolio Funds Management portfolio Real estate securities $1.3bn Office Office [ $12.1bn $14bn Healthcare _ / $0.7bn Retail <$0.1bn $17.5bn1 wet |, -$25.0bn? $6.1bn | Healthcare $0.5n Industrial _/ / $3n , Industrial _/ $4.86n 1.
Slide 42: Reconciliation to statutory profit
Financial results Reconciliation to statutory profit dexus Reference Item 30 June 2021 30 June 2020 $m $m Statutory AIFRS net profit after tax 1,138.4 972P° Investment property and inventory (Gains)/losses from sales of investment property (6.0) (0.1) Fair value gain on investment properties (583.4)
Slide 43: Management operations profit
dexus Financial result Management operations profit Property Funds Development Management FY21 ($m) Management Management Management Operations Revenue 68.0 73.2 16.1 157.3 Operating expenses (56.5) (28.1) (15.0) (99.6) FY21 net profit 1S 45.1 W 577 FY21 margin 7% 62% 7% 37% FY20 margin 27% 64% 22%
Slide 44: Cash flow reconciliation
Financial results Cash flow reconciliation dexus 30 June 2021 30 June 2020? $m $m Cash flow from operating activities 999.3 714.1 add back: payment for inventory acquisition and capex 86.7 87.1 less: cost of sale of inventory (244.6) (225.3) less: tax on trading profits not yet paid (21.6) (15.2) ad
Slide 45: Interest reconciliation
dexus Financial results Interest reconciliation 30 June 2021 30 June 2020 $m $m Total statutory finance costs 1317 139.7 Less: exchangeable note amortisation (4.0) (3.9) Less: finance costs attributable to investments accounted for using the equity method! (7.9) (4.3) Less: AASB 16 interest expense
Slide 46: Change in net tangible assets and revaluations
Financial result Change in net tangible assets and revaluations dexus Investment portfolio Valuation Weighted % of change average portfolio $m $ps $m cap rate Opening net tangible assets! (1 Jul 20) 11,850.8 10.86 Dexus Office portfolio 189.5 4.91% 80% Revaluation of real estate 583.4 0.54 a a Dexus
Slide 47: Direct property portfolio book value movements
Financial results Direct property portfolio book value movements Office! Industria! Healthcare’ Dexus total! Trading $m $m $m $m assets? (inventory) $m Opening direct property 14,171.2 2,233.2 139.7 16,544.1 335.8 Lease incentives’ 79.9 124 02 92.5 1.0 Maintenance capex 62.5 96 - 721 0.2 Acquisition
Slide 48: Debt maturity profile
1,200 1,000 800 600 400 200 - FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY34 FY35 FY36 FY37 FY38 FY39 FY40 FY41 DCM Bank
Slide 49: Hedging profile
4,000 3.0% 3,500 3,000 2.5% 2,500 2,000 2.0% 1,500 1,000 1.5% 500 - 1.0% FY22 FY23 FY24 FY25 FY26 Net fixed debt Exchangeable Notes Interest Rate Swaps Interest Rate Caps Weighted Average Hedge Rate (excl margin)
Slide 50: Capital management: debt facilities
Capital management Debt facilities! dexus Facility limit Drawn Asm Asm Sub total 5,735 4,651 Currency translation and fair value adjustments 308 328 Deferred borrowing costs and debt modifications (32) (32) Exchangeable Notes adjustments (22) (22) Total interest bearing liabilities 6,009 4,925 Bank
Slide 51: Funds management development pipeline
dexus Funds management Development pipeline $6.5 billion Funds management development pipeline $1.8 billion $4.1 billion $635 million committed projects Total Funds uncommitted projects Concept projects Project cost on uncommitted projects in Funds Management business Uncommitted projects FY22 FY23
Slide 52: Office and industrial key metrics
dexus Property portfolio Office and industrial key metrics Key metrics Office Industrial Amount of space leased! 184,029sqn2 445,428sqm No. of leasing transactions 3392 6 Occupancy by income 95.2% 97.7% Occupancy by area 94.6% 98.7% Average incentives 24.9% 19.1% No. of effective deals 78 40 Weighte
Slide 53: Office portfolio diversification
dexus Property portfolio Office portfolio diversification Office by asset type Office by location Prime grade - office 9488 WA7%, Sydney CBD/Fringe 52% QLD 13% Premium grade - office 32% $14.0bn? $14.0bn?2 Otherl% vic 20% B grade - NSW 60% office 5% Agrade - office 62% Sydney Suburban, 8% 51 Dexus 2
Slide 54: Office lease expiry profiles
Income Area Income Area 20% 30% 15% 20% 10% 10% 5% 0% 0% Available FY22 FY23 FY24 FY25 FY26 Available FY22 FY23 FY24 FY25 FY26 Income Area Income Area 20% 20% 15% 10% 10% 5% 0% 0% Available FY22 FY23 FY24 FY25 FY26 Available FY22 FY23 FY24 FY25 FY26 Income Area 20% 10% 0% Available FY22 FY23 FY24 FY
Slide 55: Office tenant industry groups
Financial and Insurance Services Legal services Public Administration and Safety Professional, Scientific and Technical Services (Except Computer System Design and… Rental, Hiring and Real Estate Services Transport, Postal and Warehousing Information Media and Telecommunications Retail Trade Mining
Slide 56: Industrial portfolio diversification
Property portfolio Industrial portfolio diversification Industrial by asset type Industrial estate 46% Land 11% $3.0bn1 Data centre 3% Distribution centre 16% Business park 24% 1. Proforma for the acquisition of APN Property Group which was approved on 27 July 2021 Asset type and location compositio
Slide 57: Industrial lease expiry profile
20% 15% 10% 5% 0% Available FY22 FY23 FY24 FY25 FY26
Slide 58: Industrial lease expiry profiles
Income Area Income Area 25% 35% 20% 28% 15% 21% 10% 14% 5% 7% 0% 0% Available FY22 FY23 FY24 FY25 FY26 Available FY22 FY23 FY24 FY25 FY26 Income Area Income Area 30% 100% 80% 20% 60% 10% 40% 20% 0% 0% Available FY22 FY23 FY24 FY25 FY26 Available FY22 FY23 FY24 FY25 FY26
Slide 59: Industrial tenant industry groups
Transport, Postal and Warehousing Retail trade Manufacturing Wholesale trade Health Care and Social Assistance Information Media and Telecommunications Construction Professional, Scientific and Technical Services Financial and Insurance Services Other Services Administrative and Support Services Ren
Slide 60: Environmental metrics
dexus Environmental metrics Office portfolio sustainability metrics Dexus Office Energy and GHG emissions intensity Dexus Office NABERS Energy ratings Dexus Office NABERS Water ratings S tors qn ae. | 2a 2 280 g| 4.5 star = 5 star i 3 57 Office portfolio Office portfolio 2% 35 stors. FyOB’ FYO?' FIO
Slide 61: Dexus completed developments and fund-throughs
dexus Development Dexus completed developments and fund-throughs Pipeline Building area! Project cost? Yield on cost? Leased Final Third party sqm $m % % completion _ partner interest % Office 180 Flinders Street, Melbourne, VIC 20,300 168 6-7% 93% Aug 20 - 80 Collins Street, Melbourne, VIC (Hotel}*
Slide 62: Dexus committed developments and fund-throughs
dexus Development Dexus committed developments and fund-throughs Pipeline Building Project cost Est. cost to Yield on Leased Completion Third party area! est? completion cost? % due partner interest sqm $m $m % % Office 123 Albert Street, Brisbane, QLD 38,600 168 166 5-6% 17% Mid 2023 - Total office
Slide 63: Dexus uncommitted developments and fund-throughs
Development Dexus uncommitted developments and fund-throughs dexus Pipeline Building Project cost _ Est. yield on est. Third party areals est.2.6 project cost? —_ partner interest sqm $m % % Office Waterfront, Brisbane, QLD 730,700 1,100 5-6% 50% 60 Collins Street, Melbourne, VIC 42,800 c.900 5-6% -
Slide 64: Transactions: Dexus
Transactions Dexus dexus Dexus acquisitions Purchase Price Interest Settlement Dexus divestments Sale Price Interest Settlement m jm 185, 159, 171 Edward Street, Brisbane, QLD (Hermes) $87.0 700% $Aug-20 Finlay Crisp Centre, Canberra, ACT $310 50% 7Jul-20 141 Anton Road, Hemmant, QLD $318 100% T1Sep
Slide 65: Transactions: Funds management
dexus Transactions Funds management Funds Management acquisitions Purchase pre Interest Settlement Funds Management divestments Sale pre Interest Settlement m m Australian Bragg Centre, Adelaide, SA’ $2231 50% 30-Oct-20 Finlay Crisp Centre, Canberra, ACT $31.0 50% Jul 20 College Junction, 695 Sandga
Slide 66: Bond yields and capitalisation rates
10 year bond yield Real 10yr bond yield New York San Francisco Paris Frankfurt/M 6% London Tokyo Singapore Sydney CBD 5% 8% 4% 3% 6% 2% 1% 4% 0% -1% Jun-11 Jun-13 Jun-15 Jun-17 Jun-19 Jun-21 2% Jun-11 Jun-13 Jun-15 Jun-17 Jun-19 Jun-21 Office Industrial Retail Healthcare Office Industrial Retail Hea
Slide 67: Retail ecommerce and logistics trends
Retail ecommerce Retail other Logistics Trade Online Total Wholesale Trade Other 3.0 100% 2.5 80% 2.0 60% 1.5 40% 1.0 20% 0.5 0% 0.0 2007 2009 2011 2013 2015 2017 2019 2021 -20% May-16 May-17 May-18 May-19 May-20 May-21
Slide 68: Sector output and property performance
400 All Property Retail Office Industrial Healthcare Health Administration Services Accomodation/Food 350 Professional Services Information Serv Construction 300 Property Services Arts and recreation Education 250 Transport/Storage Public Admin Utilities 200 Wholesale/trade Finance/Insurance Retail
Slide 69: Sydney CBD office supply and withdrawals
50 100 150 0 -100 -50 37 Pitt St, 51-55 Pitt St, 6-8 Underwood St -… Poly Centre - 210-232 George St (Poly) FY22 570 George St - Energy Australia (Far East Org) 14 Lee St (DOTA) 233 Castlereagh St - resi (Han's Group) 26-30 Lee St, 20 Lee St (Frasers) 338 Pitt St - 338 Pitt St - resi (Han's Group) D
Slide 70: Melbourne CBD office supply and withdrawals
20 40 60 80 -60 -40 -20 0 Vic Uni - 364-378 Little Lonsdale (ISPT) The Foundry (Brookfield) Royal Mint Ctr - 383 LaTrobe St (Mirvac) Reserve Bank - 56-64 Collins St (Dexus) FY22 NAB House - 500 Bourke St (ISPT) ANU House - 52-54 Collins St (Dexus) 1000 La Trobe (Poly) 100 Queen St (GPT) World Trade
Slide 71: Dexus's position in CBD office
Office markets Dexus's position in CBD office CBD Office Market Sydney Melbourne Brisbane Perth Total NLA 5,175,349sqm 5,106,785sqm 2,305,724sqm 1,807,262sqm Prime vacancy average 13.6% 15.0% 15.8% 15.4% Dexus CBD Exposure Total NLA 553,557sqm 422,426sqm 231,1SIsqm 122,202sqm Number of properties 8
Slide 72: Other information
Other information Exchange and securities used in statutory accounts dexus 30 Jun 2021 31 Dec 2020 30 Jun 2020 Closing rates for Statement of Financial Position USD 0.7518 0.7702 0.6863 Average rates for Statement of Comprehensive Income USD 0.7468 0.7302 0.6714 Post consolidation equivalent amounts
Slide 73: Glossary
dexus Glossary Distribution payout policy: Policy is to distribute in line with free cash flow. Funds From Operations (FFO): FFO is in line with Property Council of Australia definition and comprises net profit/loss after tax attributable to stapled security holders calculated in accordance with Aus
Slide 74: Important information
dexus Important information > This presentation is issued by Dexus Funds Management Limited (DXFM) in its capacity as responsible entity of Dexus (ASX:DXS). It is not an offer of securities for subscription or sale and is not financial product advice. > Information in this presentation including, wi
Slide 75: Dexus
dexus