Globalworth Real Estate Investments Limited · LSE:GWI

Globalworth Real Estate Investments — Investor Presentation (June 2018)

45 slides from Globalworth Real Estate Investments's investor presentation, Jun 21, 2018

  1. Slide 1: Globalworth: Creating CEE's Leading Office Landlord

    globalworth TM Globalworth: Creating CEE’s Leading Office Landlord Company Overview June 2018

  2. Slide 2: Disclaimer

    globalworth TM Disclaimer This presentation is strictly confidential and is being furnished to you solely for your information. It may not be reproduced or redistributed to any other person, and it may not be published, in whole or in part, for any purpose. By attending this presentation and receivi

  3. Slide 3: Globalworth At A Glance

    globalworth TM Globalworth At A Glance Overview • Globalworth is the leading office landlord in the CEE region with a portfolio of c.€2 billion in Romania and Poland • Formed in 2013 initially focused on Romania, where the founder’s experience dated back to 2001, it has become the leading office inv

  4. Slide 4: Leading CEE Office Platform

    globalworth TM Leading CEE Office Platform As at 31 December 2017; Romania Poland(1) Consolidated(1) proforma for YTD-18 acquisitions Standing Investments(2) 13 15 28 GAV(3) / Standing GAV €1,151m / €1,030m €910m / €910m €2,061m / €1,940m Occupancy(4) 90.8% 98.1% 93.8% (95.6% including tenant option

  5. Slide 5: Globalworth's Journey So Far

    globalworth TM Globalworth’s Journey So Far Key Achievements in Globalworth’s Journey since 2013 • Raised over c.€1bn of equity capital from a wide variety of international investors, including €340m in Dec-17 and €150m through Globalworth Poland in Jun-18. • Completed three milestone debt capital m

  6. Slide 6: Why Globalworth?

    globalworth TM Why Globalworth? 1 Poland & Romania: Markets with Attractive Macro-Economic and Real Estate Fundamentals 7 2 Substantial Portfolio of Robust Corporate Governance High Quality Assets Assembled in Key Locations 6 3 Strong Cash Flow Profile: Capital Discipline, Conservative Global Tenant

  7. Slide 7: Focused On Markets With Strong Macro-economic Fundamentals

    Focused On Markets With Strong Macro-economic globalworth TM 1 Fundamentals… Romania And Poland Are The Two Champions In CEE, Both In Terms Of Population And Growth Rates Romania And Poland Are The Largest Countries In CEE… …With A Consistently High GDP Growth, Above EU Average Population (2017E) We

  8. Slide 8: Well-educated Workforce And Low Costs Of Labour

    …With A Well-educated Workforce And Low Costs globalworth TM 1 Of Labour Compared To Western European Countries… A Significantly Lower Cost Workforce Than In Western Europe CEE Gradually Closing The Productivity Gap With The Western Economies 100% 100% = German level of GDP per worker(1) 2017 averag

  9. Slide 9: Becoming Major Outsourcing Hubs For Multinationals

    … Hence Becoming Major Outsourcing Hubs For globalworth TM 1 Multinationals And Financial Institutions… The New European BPO(1) Hubs Business Services Jobs Spike In CEE Poland Romania 19K • Largest outsourcing market in CEE(2), • 1st in the annual BPO index(3) , (2nd 12.5K 186K after continuous grow

  10. Slide 10: Attractive Underlying Office Markets in Romania and Poland

    …Creating Attractive Underlying Office Markets in globalworth TM 1 Romania and Poland… Ideal Timing To Have Exposure In CEE Markets Positive Inflation Expectations Support Rental Growth Domestic CPI Dublin London City, Lyon 5.0% Dusseldorf, Hamburg Copenhagen, Prague 4.0% Frankfurt, Munich, Stuttgar

  11. Slide 11: Establishing Them As Preferred Investment Destinations

    … Establishing Them As Preferred Investment globalworth TM 1 Destinations Attractive Yields Investment Volumes On The Rise In Target Markets Prime office yields, 2017 Office investment volumes (€m) 14% 2010-17 CAGR Poland: Poland Romania 2010-17 CAGR Romania: 6% 7.3% 7.1% 1,757 1,811 6.0% c. 1,580 5

  12. Slide 12: Assembled A High Quality Portfolio in Romania

    globalworth TM 2 Assembled A High Quality Portfolio in Romania… Exceptional office portfolio assembled primarily in Bucharest New CBD High Quality Portfolio Valued at c. €1,135m (Standing Assets Valued at c. €1,031m)(1) Selection of Properties Developments Globalworth Tower TCI UniCredit HQ Globalwo

  13. Slide 13: And Rapidly Growing Platform in Poland

    globalworth TM 2 …And Rapidly Growing Platform in Poland High quality office portfolio spanning Warsaw & key regional cities in Poland, complemented by high quality mixed-use (office and retail) properties Since early December 2017, €390m of acquisitions have been completed GPRE Portfolio Valued At

  14. Slide 14: Prime Locations In Romania

    globalworth TM 2 Prime Locations In Romania All Properties Are Located In Prime Locations Within Their Respective Sub-Markets With 70% Of Portfolio Located In The New CBD UniCredit HQ Historical CBD (Centre) New CBD (North)  TCI is a landmark asset as the third tallest Bucharest 1 4 5 6  Newest an

  15. Slide 15: Poland is Characterized By Multiple Regional Business Hubs

    globalworth TM 2 Poland is Characterized By Multiple Regional Business Hubs Present In Six of Poland’s largest Cities Important Hubs For Business Service Centers Total Employment growth City employment(1) 2013-2016 Closest int’d airport Kraków 50,300 80 - 100% Within city Warsaw 36,700 70 - 80% With

  16. Slide 16: Modern Assets With Green Credentials Attract Multinational Tenants

    Modern Assets With Green Credentials Helps Attract globalworth TM 2 A Strong Multinational Tenant Base Modern Portfolio Consisting Mostly of Class A, Multi-Tenanted Offices Year of Completion Split (Based on Portfolio Value) Green Certification Split (Based on Number of Assets) All of Globalworth's

  17. Slide 17: High Quality Leases With Strong Defensive Features

    globalworth TM 3 High Quality Leases With Strong Defensive Features Stable and Predictable Cash Flows Long-Term Leases  In line with strategy, the average duration of new leases continues to be 1 Expenses covered by tenants significantly higher than the market average of 5 years Tax   c. 92% of l

  18. Slide 18: Diversified High Profile Tenant Base

    globalworth TM 3 Diversified High Profile Tenant Base Romania Poland Combined  Globalworth's multi-tenant / campus leasing model reduces exposure to any particular tenant 4.0% 7.7% 3.1% 8.3% 87.7% 3.9% 3.7% 59.6% 76.5%  Companies in the IT&C, BPO and SSC and financial sectors 16.5% have been the m

  19. Slide 19: Dedicated Internal Management Expertise

    globalworth TM 4 Dedicated Internal Management Expertise Leading Property Investment Platform In CEE Globalworth Organisation Structure • Team of 75 dedicated and multi-disciplinary professionals based in Ioannis Papalekas Bucharest, complemented by c.35 people in Warsaw at Globalworth Founder & CEO

  20. Slide 20: Active Asset Management at Forefront of Business Model

    globalworth TM 4 Active Asset Management at Forefront of Business Model Core strategy • Attracting and retaining high quality tenants Local presence • Reacting to and serving tenants’ needs, as well as remaining in touch with market trends and anticipating cycles Experience • Tenant trust earned ove

  21. Slide 21: Multiple Avenues to Growth

    globalworth TM 5 Multiple Avenues to Growth Asset Management Developments Acquisitions  Opportunity to extract income and value  Outstanding reputation for delivering  Proven capabilities in acquiring, from assets product on time and on budget repositioning and developing high quality assets  Re

  22. Slide 22: Committed and Future Developments

    globalworth TM 5 Committed and Future Developments Risk Controlled Approach To Developments GW Campus Renault Bucharest GW Campus TAP TAP Luterana 2 Land Plots adjacent Emilka Project Tower II Connected(1) Tower III Extension Phase II Land Plot to existing assets(5) Development(2) Bucharest New CBD

  23. Slide 23: Executing On A Well Defined Acquisition Pipeline

    globalworth TM 5 Executing On A Well Defined Acquisition Pipeline Closing in on €300m pipeline targeted for H1-2018 Quattro Business Park, Krakow  Globalworth Poland closed the acquisition of Warta Tower in Warsaw for €55  Quattro Business Park offers a substantial office campus comprising 5 milli

  24. Slide 24: Solid Balance Sheet And Conservative Financial Policy

    globalworth TM 6 Solid Balance Sheet And Conservative Financial Policy • LTV target of 35% Extending Debt Maturity Profile: Successful Bond Market Activities Financing Strategy • Largely unsecured debt structure 80% New 7-yr bond • Target diversification across debt maturities issued in Mar-181 60%

  25. Slide 25: Broadening Shareholder Base

    globalworth TM 6 Broadening Shareholder Base Shareholder Structure(1) Strong Support From Key Shareholders Growthpoint Properties  Founder and CEO of Globalworth (I. Papalekas) has invested substantially in the company, remains fully Other 27.5% 29.0% hands-on and is committed to continue supportin

  26. Slide 26: Robust Corporate Governance Structure

    globalworth TM 7 Robust Corporate Governance Structure Strong Board Of Directors Norbert Sasse George Muchanya Ioannis Papalekas Dimitris Raptis Non-executive director Non-executive director Founder, CEO Deputy CEO and CIO Head of Corporate Strategy CEO of Growthpoint of Growthpoint Geoff Miller Eli

  27. Slide 27: Appendix

    Appendix 26

  28. Slide 28: GWI's Journey So Far

    globalworth TM GWI’s Journey So Far  Consistent and successful execution of GWI’s strategy in acquisitions, asset management and development of predominantly prime office assets  Established as the leading listed office investor and developer in Romania and a strong, local platform established in

  29. Slide 29: Strong Track Record Of Delivery On Stated Goals

    globalworth TM Strong Track Record Of Delivery On Stated Goals Globalworth Has Evolved in all Areas and Surpassed Its Targets Since Its IPO in July 2013; in Romania this has led to:  Gaining critical mass with portfolio growing in value from €0.1bn in 2013 to over €1bn in Romania  Significant incr

  30. Slide 30: Globalworth Poland – A Transformational Transaction

    globalworth TM Globalworth Poland – A Transformational Transaction Transaction Overview Transaction Rationale • In December 2017, GPRE completed the acquisition of a 71.7 % stake in • Consistent with stated strategy GPRE, a Warsaw-listed pure-play Polish real estate platform. Now been rebranded Glob

  31. Slide 31: FY17 Results & Financials

    FY17 Results & Financials 30

  32. Slide 32: FY 2017 Annual Results

    globalworth TM FY 2017 Annual Results Financial Highlights Key Financial Metrics (31 Dec 17) • EPRA NAV of €1,171.5 million (31 Dec 16: €783.8 million); +49.5% over 2017 • EPRA NAV per share of €8.84 per share (31 Dec 16: €8.57 per share); +3.2% over end €1,172m €115.9m 2016, and +6.5% over H2-17 (€

  33. Slide 33: Simplified Key Financials Overview

    globalworth TM Simplified Key Financials Overview Income Statement Balance Sheet €m 2017 2016 €m 2017 2016 Revenue (inc. Service Charge Income(1)) 77.9 68.2 Investment property 1,792.4 980.9 Operating expenses (inc. Service Charge Expense(1)) (26.8) (24.7) Goodwill 12.3 12.3 Net operating income 51.

  34. Slide 34: Selected Historical Financials — NAV Evolution

    globalworth TM Selected Historical Financials — NAV Evolution Figures in € million, Dec 31 2013 2014 2015 2016 2017 Reported NAV to ordinary equity 119.7 392.7 499.7 715.4 1,068.9 holders Adj. Deferred Tax Liability, Goodwill (net effect) and Fair Value of Financial 6.5 41.4 68.6 68.4 102.6 Instrume

  35. Slide 35: Further Portfolio Information & Selected Asset Profiles

    Further Portfolio Information & Selected Asset Profiles 34

  36. Slide 36: Portfolio Summary: Globalworth Romania

    globalworth TM Portfolio Summary: Globalworth Romania GLA Valuation Contracted Rent Est. Rent at 100% Occupancy WALL 31 December 2017 Location Asset Type (sqm) (€m) (€m) Occupancy (€m) (%) (years) Globalworth Tower Bucharest New CBD Office 54,686 173.0 11.3 11.4 98.9% 7.9 Green Court Complex Buchare

  37. Slide 37: Portfolio Summary: Globalworth Poland

    globalworth TM Portfolio Summary: Globalworth Poland GLA Valuation Contracted Rent(1) Est. Rent at 100% Occupancy(1) WALL 31 December 2017 Location Asset Type (sqm) (€m) (€m) Occupancy (€m) (%) (years) Green Horizon Lodz Office 33,510 71.3 5.2 5.2 100.0% 5.6 CB Lubicz Krakow Office 23,986 70.7 5.0 5

  38. Slide 38: Globalworth Romania - Standing Assets Globalworth Tower

    Globalworth Romania - Standing Assets globalworth TM Globalworth Tower Overview Property Photos  Landmark class A multi-tenanted office building located in the Northern part of Bucharest, delivered in 2016  2nd tallest office property in Bucharest with a height of 120m , extending over 26 floors a

  39. Slide 39: Globalworth Romania – Standing & Developments Globalworth Campus

    Globalworth Romania – Standing & Developments globalworth TM Globalworth Campus Overview Property Photos • Phase “A”, currently under development, will comprise two (side) towers facing Dimitrie Pompeiu Street (main street) offering on completion a total GLA of c.57.2k Completed Tower I sqm. The fir

  40. Slide 40: Globalworth Romania - Standing Assets UniCredit HQ

    Globalworth Romania - Standing Assets globalworth TM UniCredit HQ Overview Property Photos Very good • Landmark class A single-tenanted office building located in the Northern part of Bucharest, delivered in 2012 • The property extends over 16 floors above ground and 2 underground levels and offers

  41. Slide 41: Globalworth Romania - Standing Assets Green Court Complex

    Globalworth Romania - Standing Assets globalworth TM Green Court Complex Overview Property photos • Green Court is an award winning complex developed by Skanska in three phases, with the properties completed between 2014 and 2016 • Globalworth acquired the three class “A” offices in subsequent trans

  42. Slide 42: Globalworth Poland – Standing Assets Hala Koszyki

    Globalworth Poland – Standing Assets globalworth TM Hala Koszyki Overview Property Photos Very good(3)  Dating back to 1909, Hala Koszyki is firmly entrenched in the Warsaw centre’s landscape and atmosphere. Following a revitalization, it features the original Art Nouveau façade and a functional co

  43. Slide 43: Globalworth Poland – Standing Assets Tryton Business House

    Globalworth Poland – Standing Assets globalworth TM Tryton Business House Overview Property Photos Excellent • Tryton Business House is an office building located in one of the most characteristic places in Gdansk, at the junction of Jana z Kolna and Waly Piastowskie streets, in the vicinity of the

  44. Slide 44: Globalworth Poland – Standing Assets Green Horizon Office Centre

    Globalworth Poland – Standing Assets globalworth TM Green Horizon Office Centre Overview Property Photos • Green Horizon is a multi-tenanted modern office complex located on Pomorska street in the Northeastern part of Lodz’s business district • It was developed in phases by Skanska and comprises two

  45. Slide 45: Globalworth Poland – Standing Assets A4 Business Park

    Globalworth Poland – Standing Assets globalworth TM A4 Business Park Overview Property Photos Very good(3) • The A4 Business Park is a modern, multi-tenanted class “A” office park in Francuska street in the southern part of Katowice • The park comprises three offices delivered between 2014 and 2016,

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