Manulife Us Reit · SGX:BTOU
Manulife Us Reit — Investor Day (November 2016)
38 slides from Manulife Us Reit's investor day presentation, Nov 17, 2016
Slide 1: Manulife US REIT Investor Day 2016
Manulife US REIT Investor Day 2016 17 November 2016
Slide 2: Important Notice
Important Notice This presentation shall be read in conjunction with Manulife US REIT’s financial results announcement dated 7 November 2016 published on SGX Net. This presentation is for information purposes only and does not constitute or form part of an offer, invitation or solicitation of any of
Slide 3: Contents
Contents 1 First Pure-Play US Office REIT in Asia 2 Financial Highlights 3 Portfolio Updates 4 Moving Forward 5 Media and Analysts Coverage 6 Appendix 3
Slide 4: First Pure-Play US Office REIT in Asia
Peachtree, Atlanta, Georgia First Pure-Play US Office REIT in Asia
Slide 5: Provides Unique Exposure to the US Office Sector
Provides Unique Exposure to the US Office Sector 1 3Q 20161 Growth Exceeded Forecasts Benefitting from growth of the world’s largest economy DPU of 2.01 cents exceeded forecast by 5.8% NAV per unit increased from US$0.78 to US$0.84 Figueroa, LA 2 Resilient Portfolio Performance High occupanc
Slide 6: Reputable Sponsor with Proven Track Record in Property Management
Reputable Sponsor with Proven Track Record in Property Management Vertically-Integrated Real Estate Platform with Global Real Estate AUM of US$15.2b Vancouver Sponsor Calgary Kitchener/Waterloo Edmonton Toronto Canada Ottawa US$6.5B Montreal AUM AUM Halifax 75% of Real Estate in Office US$718B US As
Slide 7: Financial Highlights
Figueroa, Los Angeles, California Financial Highlights
Slide 8: 3Q 2016 Growth Exceeded Expectations
3Q 20161 Growth Exceeded Expectations For period 20 May Actual Forecast2 Change 2016 to 30 September (US$’000) (US$’000) (%) 2016 Net Property Income 17,603 17,339 1.5 Distribution per Unit 2.01 1.90 5.8 (cents) As at As at Change 31 Dec 2015 30 Sep 2016 (%) NAV per Unit 0.78 0.84 7.7 (US$ per unit)
Slide 9: Prudent Financial Management
Prudent Financial Management Proactive Capital Management 99.2% of Leases have Rental Escalations 0.8% 15.0% As at 30 Sep 2016 Gross Borrowings US$296.0 million 84.2% Gearing Ratio1 34.7% Annual rental escalations which average around 3% Weighted Average Mid-term or periodic rental increases 2.46% p
Slide 10: Portfolio Updates
Peachtree, Atlanta, Georgia Portfolio Updates Confidential, Not for Further 10
Slide 11: Well-Diversified Freehold Portfolio
Well-Diversified Freehold Portfolio Portfolio Summary as at 30 Sep 2016 Total NLA 1,782,812 sq ft Peachtree Peachtree 24.4% Figueroa 22.4% 33.0% Figueroa WALE by (NLA) 6.1 years 37.2% US$813.2m US$48.6m Portfolio Occupancy 97.0 % PY2017 NPI Valuation Land Tenure 100% freehold Michelson Michelson 42.
Slide 12: High Occupancy Rates in the Past 5 Years
High Occupancy Rates in the Past 5 Years Historical Occupancy Rates1 as at 30 Sep 2016 (%) 96.5 97.0 94.7 95.0 92.8 91.5 2011 2012 2013 2014 2015 3Q 2016 (1) Reflects committed leases as at each date 12
Slide 13: Favourable Lease Profile with WALE of 6.1 Years
Favourable Lease Profile with WALE of 6.1 Years Minimal Lease Expiries in the Next 2 Years Lease Expiry Profile as at 30 Sep 2016 (%) 68.1 64.7 14.4 10.9 9.4 8.6 5.1 5.2 4.7 5.3 1.7 1.9 2017 2018 2019 2020 2021 2022 and beyond Cash Rental Income Net Lettable Area 13
Slide 14: Quality Tenant Base Across Different Sectors
Quality Tenant Base Across Different Sectors Cash Rental Income Breakdown by Trade Sector as at 30 Sep 2016 Business Engineers/ Administrative Services Architects Services 2.7% 2.6% 2.6% Advertising & Public Relations 3.9% Others 6.1% Law Firms 44.4% Arts & Entertainment 6.4% Real Estate 6.7% Financ
Slide 15: Downtown Los Angeles
Downtown Los Angeles Influx of Millennials has Transformed DTLA into a Live, Work, Play Destination Key Facts: Los Angeles High Office Demand in DTLA Population 10.2 million1 11,108 residential units under construction with an additional 14,502 units currently proposed3 Median household US$54,5142 C
Slide 16: Figueroa: No New Class A Office Space in Past 23 Yrs
Figueroa: No New Class A Office Space in Past 23 Yrs Excellent Location and Amenities As at 30 Sep 2016 Located in the South Park submarket1 NLA (sq ft) 694,267 Valuation US$302.5m Close proximity to Metro station and freeway1 WALE (by NLA) 5.7 years Nearby entertainment venues: Staples Center, LA C
Slide 17: Irvine, Orange County
Irvine, Orange County Irvine is Considered the “CBD” of Orange County Key Facts: Irvine Limited Office Supply in Orange County Population 3.2 million1 Strong labour pool with senior executives, middle managers and Median administrative personnel household US$72,8562 Financial and business services a
Slide 18: Michelson: Surrounded by Hotels, Restaurants and Residential Developments
Michelson: Surrounded by Hotels, Restaurants and Residential Developments Excellent Location and Amenities As at 30 Sep 2016 NLA (sq ft) 532,603 4km from John Wayne Airport1 Valuation US$328.6m WALE (by NLA) 5.8 years Occupancy Rate 99.1% Michelson Lease Expiry Profile as at 30 Sep 2016 (%) John Way
Slide 19: Atlanta
Atlanta Pro-Business Environment Leads to Strong Job Growth Key Facts: Atlanta Favourable Market Conditions in Atlanta Population 5.7 million1 Home to 18 Fortune 500 companies Median Companies are relocating Atlanta to take advantage of its location and low household US$56,6182 costs income 12.5% re
Slide 20: Peachtree: Located Along Atlanta's Midtown Mile
Peachtree: Located Along Atlanta’s “Midtown Mile” Excellent Location and Amenities As at 30 Sep 2016 20 minutes from world’s busiest airport NLA (sq ft) 555,942 (Hartsfield-Jackson International) Portfolio Value US$182.1m Conveniently located near freeways and Metro stations1 WALE (by NLA) 6.7 years
Slide 21: Asset Enhancements
Asset Enhancements Adding Sustainable Value to Our Properties Figueroa Increase NLA by 7.1% on 72,014 sq ft of new leases signed due to BOMA 20101 Michelson Tesla battery project now fully operational, generating energy savings for tenants and reducing tenants’ occupancy costs Peachtree Bathrooms an
Slide 22: Media and Analysts Coverage
Michelson, Irvine, California Michelson, Irvine, California Media and Analysts Coverage
Slide 23: Widespread Media Coverage
Widespread Media Coverage BT 15 Nov 2016 ST 8 Nov 2016 BT 8 Nov 2016 LHZB 8 Nov 2016 BT 11 Oct 2016 The Edge May 2016 Confidential, Not for Further 23
Slide 24: Analysts Coverage
Analysts Coverage Deutsche Bank Markets Research, 7 Nov 2016 DBS Group Research, 8 Nov 2016 Lim & Tan Securities, 4 Nov 2016 Religare Institutional Research, 8 Nov 2016 24
Slide 25: Favourable Distribution Yield
Favourable Distribution Yield Distribution Yield is 470 bps Above1 10-Year US Government Bond Yield 8% 7.0% 6.7% 7% 6% MUST Distribution Yield is 470 bps above 10-year US 5% Government Bond Yield 4.1% 4% 3% 2.3% 2.3% 2% 1% 0.4% 0.1% 0% MUST FTSE REIT STI Index 10-year US 10-year SG 12 Months Savings
Slide 26: Moving Forward
Michelson, Irvine, California Moving Forward
Slide 27: What Now Post US Election…
What Now Post US Election… Confidential, Not for Further 27
Slide 28: Moving Forward
Moving Forward 1 Portfolio Outperforms US Market Average • 68.1% of leases will expire in 2022 and beyond • High occupancy of 97.0%1 is above US market average of 87.5%2 • Majority of leases have rental escalations averaging around 3% p.a. 2 Growth through Acquisitions • Target to acquire one asset
Slide 29: Thank You
Thank You For enquiries, please contact: Ms Caroline Fong, Head of Investor Relations Direct: (65) 6801 1066 / Email: carol_fong@manulifeusreit.sg MANULIFE US REAL ESTATE INVESTMENT TRUST 51 Bras Basah Road, #11-00 Manulife Centre, Singapore 189554 http://www.manulifeusreit.sg
Slide 30: Appendix
Michelson, Irvine, California Appendix
Slide 31: Portfolio Overview
Portfolio Overview Figueroa Michelson Peachtree Portfolio Location Los Angeles Irvine Atlanta Property Type Class A Trophy Class A Completion Date 1991 2007 1991 Last Refurbishment 2015 - 2015 Property Value1 US$302.5m US$328.6m US$182.1m US$813.2m Net Property Income2 US$16.0m US$20.7m US$11.9m US$
Slide 32: Depth of Top 15 US Office Markets
Depth of Top 151 US Office Markets Seattle-Bellevue Chicago New York Boston • Inventory: 93.4m sq ft • Inventory: 243.2m sq ft • Inventory: 449.9m sq ft • Inventory: 166.1m sq ft • Occupancy: 91.7% • Occupancy: 86.1% • Occupancy: 90.0% • Occupancy: 86.5% • Median Household • Median Household • Media
Slide 33: Benefitting from the Growth of the World's Largest Economy
Benefitting from the Growth of the World’s Largest Economy Exposure to Growth of US Economy and USD US GDP Growth (y-o-y %)1 US Unemployment (%)2 2.5 9.3 9.6 8.9 2.7 2.6 8.1 2.3 2.4 2.2 7.4 1.8 1.6 1.7 1.6 -0.3 6.2 5.8 5.6 5.3 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F2017F 4.6 4.6 4.9
Slide 34: Favourable US Real Estate Outlook
Favourable US Real Estate Outlook Demand for Office Space Driven by Technology and Other Creative Sectors US Office Net Absorption (m sq ft) US Office Employment1 (y-o-y %) and Occupancy Rate (%)2 89.3 89.4 88.9 89.1 89.1 88.6 88.7 3.0 3.0 2.3 2.4 2.4 1.6 29.5 0.5 26.2 23.0 22.4 22.7 21.2 16.9 2007
Slide 35: Passing Rents Increasing
Passing Rents Increasing Average Property Gross Rent (US$ psf per year) As at 31 Dec 2015 As at 30 Sep 2016 Change Property (US$) (US$) (%) Figueroa 35.10 36.62 4.3 Michelson 47.50 48.92 3.0 Peachtree 30.00 30.89 3.0 Total 37.20 38.65 3.9 35
Slide 36: Efficient Tax Structure
Peachtree, Atlanta, Georgia Efficient Tax Structure
Slide 37: Tax Efficient Structure of Manulife US REIT
Tax Efficient Structure of Manulife US REIT Sponsor Manulife Unitholders No 30%1 withholding tax on interest and principal on shareholder’s loan - US Portfolio Interest 0% Tax Exemption Rule Zero tax in Singapore - Foreign sourced income not subject to tax Distribution from US to Singapore through 1
Slide 38: Additional Disclaimer
Additional Disclaimer CoStarPS does not purport that the CoStarPS Materials herein are comprehensive, and, while they are believed to be accurate, the CoStarPS Materials are not guaranteed to be free from error, omission or misstatement. CoStarPS has no obligation to update any of the CoStarPS Mater