Gpt Group · ASX:GPT

Gpt — FY2013 Earnings Presentation

47 slides from Gpt's earnings presentation, Feb 13, 2014

1. Slide 1: GPT 2013 Annual Result

   For personal use only GPT 2013 ANNUAL RESULT 13 FEBRUARY 2014

2. Slide 2: 2013 Annual Result Highlights: Delivering on strategy

   2013 ANNUAL RESULT HIGHLIGHTS Delivering on strategy For personal use only FRUGAL APPROACH DRIVEN BY TOTAL GROWTH IN FUM AND FORTRESS RETURN BALANCE SHEET  8.5% Total Return  22.3% gearing  #1 performing retail providing significant and office funds  6.1% EPS growth capacity  7.5% growth in FUM

3. Slide 3: High level of activity over the year

   2013 ANNUAL RESULT HIGHLIGHTS High level of activity over the year For personal use only Significant Leasing Activity Development  551 retail deals $1.1 billion  Highpoint expansion  123,700 sqm office Transactions  Liberty Place  156,600 sqm logistics  $300m developments Acquisitions commence

4. Slide 4: Our Approach: Target earnings composition

   OUR APPROACH Target earnings composition For personal use only 90% earnings from Australian Investment Property 10% Grow to 10% active earnings  Driven by Total Return  Targeting $10bn increase in  Sector specialists in a Australian FUM diversified framework  Maintains low cost of capital  Effe

5. Slide 5: Our Position: GPT's value opportunity

   OUR POSITION GPT’s value opportunity For personal use only Quality Portfolio  Positioned for long term performance  Active portfolio approach  Diversified with multi-sector expertise Funds Growth and NAV Uplift  #1 performing funds Efficient  Value yet to be attributed to Funds TRUE  Australia

6. Slide 6: Our Outlook: Targeting Total Return > 9% in 2014

   OUR OUTLOOK Targeting Total Return > 9% in 2014 For personal use only ECONOMY  There is evidence of renewed confidence in Australia’s future  Consumer spending has gathered momentum RETAIL  Regional Centres are well placed to benefit  Well priced acquisitions will be limited  Leading indicators

7. Slide 7: 2013 Annual Result Summary

   2013 ANNUAL RESULT SUMMARY 6.1% increase in earnings per security For personal use only 12 months to 31 December ($m) 2013 2012 Change Total Realised Operating Income (ROI) 471.8 456.4  3.4% Valuation movements 92.2 196.1 Financial instruments marked to market and FX movements 20.3 (40.4) Other(1)

8. Slide 8: Management divisions increase profitability

   2013 ANNUAL RESULT SUMMARY Management divisions increase profitability For personal use only 12 months to 31 December ($m) 2013 2012 Change Divestment of assets Retail NOI 264.3 300.9  12.2% Full year inclusion of One One Office NOI 144.1 135.6  6.3% One Eagle Street Logistics NOI 76.2 69.3  10.0

9. Slide 9: Capital Management: A fortress balance sheet

   CAPITAL MANAGEMENT A fortress balance sheet For personal use only As at 31 December 2013 2012 Change Increase in valuations of 5c Net tangible assets per security $3.79 $3.73(1)  1.6% plus derivatives MTM of 1c Total borrowings $2,310m $2,144m  7.8% Gearing(2) 22.3% 21.7%  60 bps One of the lowes

10. Slide 10: Total Return analysis

    DRIVEN BY TOTAL RETURN Total Return analysis For personal use only Total Return Calculation 2013 Total Return 8.5% Total Return = Change in NTA + Distributions Impact of: Opening NTA  Leverage  Buy-back  Fees and expenses  Derivatives 8.5% = $0.06 + $0.255(1) $3.73 8.0% Portfolio Group 1. Made u

11. Slide 11: Asset portfolio delivered an 8.0% Total Portfolio Return

    DRIVEN BY TOTAL RETURN Asset portfolio delivered an 8.0% Total Portfolio Return For personal use only Total Portfolio Return(1) 12 months to 31 December 2013 11.8% 9.9% 9.8% 9.8% 9.5% 8.8% 8.5% 8.6% 8.5% 7.9% 8.0% 7.5% Retail Office Logistics Total Portfolio 1 year 3 year 10 year 1. 1 and 3 year unl

12. Slide 12: Retail: 2013 highlights

    DRIVEN BY TOTAL RETURN Retail: 2013 highlights For personal use only 2.5%  Solid income growth supported by high occupancy and like for like income fixed structured reviews growth  Improvement in sales growth over the second half 99.6%  Enhanced portfolio composition with the divestment of Erina

13. Slide 13: Retail: High occupancy with solid comparable income growth

    DRIVEN BY TOTAL RETURN Retail: High occupancy with solid comparable income growth For personal use only 12 months to 31 December 2013 2012 Total Portfolio Return 7.5% 8.4% Comparable income growth 2.5% 3.0% Comparable total centre sales growth(1) 1.1% 1.3% Comparable specialty sales growth(1) 1.8% 1

14. Slide 14: Retail: Wealth effect fuelling recent momentum and improved outlook

    DRIVEN BY TOTAL RETURN Retail: Wealth effect fuelling recent momentum and improved outlook For personal use only ABS Retail Trade Growth(1) 6% Monthly % Change on 5% Headwinds 4%  COGS pressure from falling AUD prior year 3% 2%  Business costs pressure 1% 0% Tailwinds Jan-12 Feb-12 May-12 Jun-12 J

15. Slide 15: Retail: Continue to invest in prime regional centres

    DRIVEN BY TOTAL RETURN Retail: Continue to invest in prime regional centres For personal use only 10 Year Total Returns vs Volatility(1) 12.0% 11.5% Regional Total returns 11.0% Sub-regional (%p.a.) 10.5% Neighbour- 10.0% 9.5% hood 2014 Priorities 9.0% 2.0% 3.0% 4.0% 5.0% 6.0%  Enhance portfolio co

16. Slide 16: Office: 2013 highlights

    DRIVEN BY TOTAL RETURN Office: 2013 highlights For personal use only  Expiries from 2014-2016 reduced from 40% to 24%(1) 8.8% Total Portfolio Return  Strong total portfolio return of 8.8%  123,700 sqm of signed leases (12,000 sqm at HOA) Reduction in expiries  Internalised property management fo

17. Slide 17: Office: Strong total return in difficult leasing environment

    DRIVEN BY TOTAL RETURN Office: Strong total return in difficult leasing environment For personal use only 12 months to 31 December 2013 2012 Total Portfolio Return 8.8% 9.2% Comparable income growth 0.7% 3.8% Occupancy(1) 90.6% 95.8% Weighted average lease expiry 5.8 years 5.4 years Leases signed 12

18. Slide 18: Office: Difficult fundamentals however beyond the trough

    DRIVEN BY TOTAL RETURN Office: Difficult fundamentals however beyond the trough For personal use only CBD Office – Sublease Space  Leading property indicators highlight mid 2013 Q4 2011 to Q4 2013 2.1% as the trough in the cycle 2.0% 1.7% 1.5% 1.6% % of Stock  However, likely to be subdued growth

19. Slide 19: Office: Enhancing the portfolio

    DRIVEN BY TOTAL RETURN Office: Enhancing the portfolio For personal use only 2012-2013: De-risking Portfolio  De-risking future lease expiries  Leasing to drive total return  Internalisation of property management 2014 Priorities  Delivered strong total return  Enhance portfolio diversification

20. Slide 20: Logistics: 2013 highlights

    DRIVEN BY TOTAL RETURN Logistics: 2013 highlights For personal use only  Initial growth strategy target achieved(1) Achieved initial growth targets  Strong portfolio performance with 8.6% total portfolio return 8.6%  $107 million of investment product acquired Total Portfolio Return  $377 millio

21. Slide 21: Logistics: Maintaining strong performance

    DRIVEN BY TOTAL RETURN Logistics: Maintaining strong performance For personal use only 12 months to 31 December 2013 2012 Total Portfolio Return 8.6% 11.5% Comparable income growth 1.0% 2.7% Occupancy 96.2% 98.2% Weighted average lease expiry 5.1 years 5.8 years Leases signed(1) 156,639 sqm 68,133 s

22. Slide 22: Logistics: Industrial market providing steady performance

    DRIVEN BY TOTAL RETURN Logistics: Industrial market providing steady performance For personal use only Australian Industrial Market Supply 3,000,000  Steady level of supply forecast for 2014 Completed 2,500,000 Under construction - Vacant  Greatest activity in western Sydney and 2,000,000 Under co

23. Slide 23: Logistics: Continuing to opportunistically expand the platform

    DRIVEN BY TOTAL RETURN Logistics: Continuing to opportunistically expand the platform For personal use only 2012-2014: Growth Strategy Phase 1 2014 Priorities Capital Average Yield Value WALE  Continue to grow platform  Reinvestment in the development Acquisitions $222 3.2 years 9.1% pipeline mill

24. Slide 24: Funds Management: Targeting $10 billion increase in FUM

    FUNDS MANAGEMENT Targeting $10 billion increase in FUM For personal use only  $110 million seed asset acquisition in 2013 (Optus Centre, Brisbane)  $381 million in developments underway  $1.2 billion in acquisition agreements in relation to CPA bid Funds Management Growth Pathway Dec 13 FUM Growt

25. Slide 25: For personal use only

    ee The most important thing the team at GPT can do Is to effectively allocate capital to generate the strongest possible total returns over time for securityholders.

26. Slide 26: 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

27. Slide 27: Appendices

    For personal use only GPT 2013 ANNUAL RESULT APPENDICES

28. Slide 28: Retail

    For personal use only RETAIL

29. Slide 29: Portfolio remains resilient despite subdued sales environment

    RETAIL Portfolio remains resilient despite subdued sales environment For personal use only  21 vacancies across the GPT and 12 months to 31 December 2013 2012 GWSCF portfolios  Critical retailer count stable Vacancies(1) 21 26  Leasing spreads of -5.2% ‘Critical’ retailers(2) 40 42 representing $

30. Slide 30: Well positioned, dominant assets perform strongly

    RETAIL Well positioned, dominant assets perform strongly For personal use only Melbourne Central Highpoint Shopping Centre Retail – Specialty  sales analysis 9.6% total return in 2013  10.6% total return in 2013  Valuation at $998.2 m (3.1% growth)  Recent expansion delivered a re-  Strong posi

31. Slide 31: Develop when the time is right

    RETAIL Develop when the time is right For personal use only Casuarina Square – mixed use and a staged approach to development STAGE 1 STAGE 2 STAGE 3 Mixed use Leisure & Entertainment Myer Expansion Progress: Progress: Progress:  DA approved for student  DA approved  DA approved accommodation  A

32. Slide 32: Office

    For personal use only OFFICE

33. Slide 33: Leasing to enhance value

    OFFICE Leasing to enhance value For personal use only  136,000 sqm leased or at HoA Major leasing transactions completed in 2013 over 101 transactions Asset Tenant Area  Continuing to de-risk portfolio (sqm) - 24% expiring over 2014-16 2 Park Street Citi 18,469 - 16% reduction since Dec 11 8 Exhib

34. Slide 34: Structure to create value

    OFFICE Structure to create value For personal use only Proven Asset Management Development  9.5% portfolio IRR over 10 years  Acquisitions including fund-throughs  Melbourne Central Tower: - Liberty Place/150 Collins Street 10.4% total return in 2013 post  Enhance assets internalisation of manag

35. Slide 35: Opportunities to maximise value

    OFFICE Opportunities to maximise value For personal use only Australia Square, Sydney 1 Farrer Place, Sydney  11.5% total return in 2013  Focus on tenant retention and  Renewal of three major tenants leasing of GMT  Major tower capex completed  Enhance IRR by de-risking cashflow  Focus on bran

36. Slide 36: Update on major near term expiries

    OFFICE Update on major near term expiries For personal use only Asset Tenant Area Expiry Portfolio Progress (sqm) Impact (%) Australia Square Vacant 4,317 0.7% 3 whole floors, plus suites 2 Park Street Vacant 2,495 0.4% 5 part floors/suites MLC Centre Vacant 23,493 3.7% Levels 23-39, 63 plus suites

37. Slide 37: Leading Economic Indicators

    OFFICE Leading Economic Indicators For personal use only CBD Office: Prime Vacancy Rate  Key leading indicators point to a potential 14% 12.1% Q4 2012 to Q4 2013 11.4% upturn in economic and employment activity 12% 10.2%10.6% 10.2% 10% 8.1% 8.7%  Increase in vacancy rate although sub-lease 8% 8.0%

38. Slide 38: Logistics

    For personal use only LOGISTICS

39. Slide 39: Growth through development and acquisitions

    LOGISTICS Growth through development and acquisitions For personal use only 22% $1.43bn 72% 18% $1.17bn growth since $0.99bn 2011 19% $0.83bn Aqusitions/Divestments Land/Under Development Completed Development Product Investments¹ 2011 2012 2013 Post Developments² 1. Less acquisitions made during th

40. Slide 40: Prime eastern seaboard locations

    LOGISTICS Prime eastern seaboard locations For personal use only CBD CBD CBD BRISBANE 3 assets MELBOURNE 4 assets SYDNEY 23 assets  Adjacent to airport  Intermodal hub (train,  Access to M1, M4 and Hume and Brisbane port road) Motorways  Major arterials and  Proximity to city centre  Major log

41. Slide 41: Further expansion through development

    LOGISTICS Further expansion through development For personal use only  $377 million committed development pipeline to increase portfolio WALE to 8+ years Developments Development Average Target Completion Cost WALE Yield Toll NQX, Karawatha, Qld $84.6m 15 years 7.6% 1H 2014 TNT, Esrkine Park, NSW $

42. Slide 42: $300m Erskine Park Estate 89% complete or underway

    LOGISTICS $300m Erskine Park Estate 89% complete or underway For personal use only TNT 31,902 sqm logistics facility Development cost: $60m Completion: 1H 2015 GOODMAN FIELDER WALE: 15.5 years RRM 20,571 sqm cold storage facility Development cost: $94m Completion: 1H 2015 RAND 23,757 sqm cold storag

43. Slide 43: Sydney Olympic Park development

    LOGISTICS Sydney Olympic Park development For personal use only SOP TOWN CENTRE SITE 5.2 hectares Running yield: 8.5% FSR 3.2:1 Potential mixed use opportunity 4 MURRAY ROSE AVENUE 15,000 sqm campus office building Development cost: $85m In planning 3 MURRAY ROSE AVENUE 12,950 sqm campus office buil

44. Slide 44: Funds Management

    For personal use only FUNDS MANAGEMENT

45. Slide 45: Top performing core wholesale funds in retail and office

    FUNDS MANAGEMENT Top performing core wholesale funds in retail and office For personal use only a2013 Highlights GPT Total Return from Funds Management  $7.1 billion of funds under 12 Months Ended 31 December 2013 management 3.1% 11.2%  GWOF and GWSCF the top performing wholesale core funds in 1.8

46. Slide 46: GPT Wholesale Office Fund performs strongly

    FUNDS MANAGEMENT GPT Wholesale Office Fund performs strongly For personal use only  #1 performing wholesale core office fund over 1, 3 and 5 years  10% total return delivered in 2013  Acquisition of 8 Exhibition Street  Development at Liberty Place completed delivering significant valuation upli

47. Slide 47: GPT Wholesale Shopping Centre Fund continues to perform well

    FUNDS MANAGEMENT GPT Wholesale Shopping Centre Fund continues to perform well For personal use only  #1 performing wholesale core retail fund over 1 year delivering 9.6% Total Return  Development at Highpoint completed delivering significant valuation uplift  $569 million capital raising complete

GPT Group — FY2013 Earnings Presentation on 6ix