Investor Presentation

Transcription

1 1 1 Investor Presentation Third Quarter 2017 CONTACTS SARAH INMON (HEAD OF INVESTOR RELATIONS) EDUARDO PEREZ MARCHANT (CORPORATE FINANCE MANAGER) CLAUDIO CHAMORRO (CFO) TEL: (562) IR@PARAUCO.COM

2 2 Important Disclaimer This document has been prepared by for the purpose of providing general information about the Company. The Company assumes no responsibility for, or makes any representation or warranty, express or implied, with respect to, the accuracy, adequacy or completeness of the information contained herein. The Company expressly disclaims any liability based on such information, errors therein or omissions therefrom. This presentation includes certain statements, estimates and forecasts provided by the Company with respect to it s anticipated future performance and involves significant elements or subjective judgment and analysis that may or may not prove to be accurate or correct. There can be no assurance that these statements, estimates and forecasts will be attained and actual outcomes and results may differ materially from what is estimated or forecast herein. The information contained herein has been prepared to assist interested parties in making their own evaluation of the company and does not purport to be all - inclusive or to contain all the information that a potential counterparty may desire. In all cases, interested parties should conduct their own independent investigation and analysis of the Company. Interested parties can only rely on the result of their own investigation and the representations and warranties made in any definitive agreement that may be executed.

3 3 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS

4 at a glance 4 is the third largest shopping center operator in Chile and Peru, and the fifth largest in Colombia. Indicator Country CHILE PERU COLOMBIA TOTAL GLA (m 2 ) 1 455, , , ,500 Owned GLA (m 2 ) 420, , , ,519 Revenues LTM 3Q17 (US$MM) # of operations SHAREHOLDER STRUCTURE (SEPTEMBER 2017) 6% Others 1% Local mutual funds 21% Foreign investment funds 22% Local brokers MARKET CAP 3 US$MM 2,421 26% Controlling Group 5% Said Yarur Family 3% Abumohor Family 16% Local pension funds DAILY TRADED VOLUME 9M17: US$MM 3.1 OPERATIONAL METRICS BY COUNTRY 14.4% Chile Peru Colombia 46.0% OPERATIONAL METRICS BY FORMAT 78.9% 10. 7% 39.6% TOTAL TOTAL GLA 1 REVENUES 988,500 M 2 2 US$MM % 4.0% 59.8% Regional Neighborhood Outlet Strip center 88.0% 5.0% TOTAL TOTAL GLA 1 REVENUES 988,500 M 2 2 US$MM % 11.6% 5.9% 1.1% Source:. (1) Does not include Marina Arauco nor Mall Center Curicó. (3) Source: Bloomberg (2) Revenues from October September Exchange Rate: US$=

5 In the last five years has doubled GLA, revenues and EBITDA 1982 Kennedy opens as first shopping center in Chile 1993 Arauco Maipu inaugurates in Santiago 5 GLA (1) M 2 559, , x 728, , , , LTM 3Q S.A. IPO 1997 Inauguration of Marina Arauco in Viña del Mar, Chile 2006 expands into Peru with the purchase of a 45% stake in MegaPlaza Norte in Lima 2008 acquires Arauco Estación in Santiago, Chile 2010 opens first mall in Colombia, Parque Arboleda in Pereira 2011 Capital increase for US$145 MM 2012 enters outlet format in Chile by acquiring Arauco Premium Outlet Buenaventura 2014 Capital increase for US$182 MM 2015 Purchase of minority shareholders in Colombia and Peru 2016 Capital increase for US$100 MM REVENUES (1) US$ MM x LTM 3Q17 Source:. Exchange Rate: US$= (1) Does not include Marina Arauco nor Mall Center Curicó EBITDA (1) US$ MM x LTM 3Q17 191

6 The spread over the cost of capital of our last projects is approximately 3% 6 9% 6% 3% Source: REAL CAP RATE (1) REAL WACC (2) SPREAD OVER REAL WACC (1) Real cap rate is the yield on cost rate averaged by amount invested and considers the following properties: Arauco Express Calama, Arauco Express Ciudad Empresarial I, Arauco Express Colón, Arauco Express Huechuraba, Arauco Express Irarrázaval, Arauco Express Las Brujas, Arauco Express Luis Pasteur, Arauco Express Manuel Montt, Arauco Express Palmares, Arauco Premium Outlet Buenaventura, Arauco Premium Outlet Curauma, Arauco Premium Outlet San Pedro, Arauco Premium Outlet Coqumbo, Arauco Quilicura, MegaPlaza Chimbote, MegaPlaza Express Villa El Salvador, MegaPlaza Express Chincha, InOutlet Faucett, Viamix Chorrillos, Viamix Las Malvinas, InOutlet Premium Lurín, MegaPlaza Cañete, MegaPlaza Express Barranca, MegaPlaza Pisco, El Quinde Cajamarca, El Quinde Ica, Plaza Jesús María, Parque Caracolí. (2) Weighted Average Cost of Capital

7 7 Return s value creation is proven by the fact that it has had one of the highest Return of the real estate sector in the last years TOTAL RETURN 1, LAST 5 YEARS ANNUALIZED, LOCAL CURRENCY TOTAL RETURN 1, LAST 10 YEARS ANNUALIZED, LOCAL CURRENCY 15% S&P % 10% Iguatemi 9% Unibail 8% Klepierre Hammerson 6% Multiplan Falabella 6% IPSA Source: Bloomberg (1) return includes dividends as of October 31, % 6% 5% Simon 4% Macerich 3% GGP 2% Fibra Uno -2% Intu -3% Aliansce -4% -5% -6% Cencosud BR Malls Taubman 21% Falabella 18% Simon 16% Taubman 15% Klepierre 13% Fibra Uno 12% Macerich 11% IPSA 10% Cencosud 9% Multiplan 8% Unibail 8% GGP 8% S&P 8% Iguatemi 7% BR Malls 7% Hammerson 5% Aliansce 4% Intu 0%

8 Revenue type and contract duration 8 FIXED VS VARIABLE RENTAL REVENUES AS OF SEPTEMBER 31, % Other Revenues 85% Rental Revenues CONTRACT LENGTH (BASED ON % OF REVENUES) 40% 100% 14% Variable Revenues 32% 14% 14% 86% Fixed Revenues Our rental revenues are derived primarily from fixed contracts and are protected against inflation 2 YEARS 2-3 YEARS 3-4 YEARS 4 YEARS TOTAL 40% of our contracts have a duration of more than 4 years and the average length is 6.0 years

9 Purpose, Mission and Corporate Values 9 CORPORATE PURPOSE OUR VALUES Our purpose is to create spaces that contribute to improving people s lives. MISSION Our mission is to be leaders in developing and operating real estate assets, through profitable and sustainable growth that generates value for our stakeholders PILLARS OF OUR CULTURE Happiness Excellence STRATEGIC OBJECTIVES Growth Profitability Sustainability Respect for people and the environment Choose the Right option, not the easiest one Create a work environment that inspires an exceptional Te a m Openness to change and innovation Make things happen

10 10 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS

11 has iconic and dominant shopping centers in Chile, Peru and Colombia 11 has iconic shopping centers in all three countries PARQUE ARAUCO KENNEDY - CHILE ARAUCO MAIPÚ - CHILE LARCOMAR - PERÚ PARQUE LA COLINA- COLOMBIA MEGAPLAZA NORTE - PERÚ ARAUCO ESTACIÓN - CHILE

12 "Market Specialist" 12 is concentrated in Santiago and Lima, which makes the company a market specialist in these cities Lima Santiago INOUTLET FAUCETT LARCOMAR INOUTLET PREMIUM LURÍN MEGAPLAZA NORTE JESUS MARIA VILLA CHORRILLOS VILLA EL SALVADOR Lima 1 : 20% of NOI Lima Santiago ARAUCO QUILICURA ARAUCO MAIPÚ ARAUCO PREMIUM OUTLET BUENAVENTURA PARQUE ARAUCO KENNEDY ARAUCO ESTACIÓN Santiago 1 : 52% of NOI (1) Santiago represents 78% of the NOI of Chile, Lima represents 66% of the NOI of Peru, and Bogota represents 7% of the NOI of and 63% of the NOI of Colombia in the third quarter of 2017.

13 Chilean Portfolio Colombia 13 In Chile has 7 regional shopping centers, 4 outlets and 14 strip centers. The average age of the portfolio is 16 years. Perú Chile GLA (m 2 ) % Ownership Owned GLA (m 2 ) Occupancy Year of incorporation Kennedy 112, % 112, % 1982 Arauco Maipú 74, % 74, % 1993 Arauco Chillán 32, % 32, % 2007 Arauco Estación 66,500 83% 55, % 2008 Arauco San Antonio 28,500 70% 19, % 2009 Arauco Express 1 33,000 53% 17, % 2012 Arauco Premium Outlets 2 47, % 47, % 2012 Arauco Quilicura 32, % 32, % 2013 Arauco Coronel 30, % 30, % 2017 Chile 455,500 92% 420, % Chile Source: (1) Arauco Express has 14 Stripcenters in Chile: 11 strip centers in Santiago, 1 in Viña del Mar, 1 in Calama, and 1 in Antofagasta. (2) Arauco Premium Outlet has four outlets located in Santiago, Concepción, Coquimbo and Curauma.

14 Peruvian Portfolio Colombia In Peru in the company has 6 regional shopping centers and 9 neighborhood shopping centers, 2 outlets and 2 strip centers. The average age of the portfolio is 6 years. Perú Peru GLA (m 2 ) % Ownership Owned GLA (m 2 ) Occupancy Year of incorporation MegaPlaza Norte 111,500 50% 55, % 2006 MegaPlaza Express Villa Chorrillos 8,000 50% 4, % 2009 Larcomar 26, % 26, % 2010 Parque Lambramani 29, % 29, % 2010 MegaPlaza Chimbote 28,000 50% 14, % 2012 MegaPlaza Express Villa El Salvador 9,500 50% 4, % 2012 MegaPlaza Express Chincha 9,000 50% 4, % 2013 InOutlet and Viamix (2) 23, % 23, % 2013 MegaPlaza Cañete 16,500 50% 8, % 2013 MegaPlaza Express Barranca 10,000 50% 5, % 2013 MegaPlaza Pisco 14,500 50% 7, % 2015 El Quinde Cajamarca 31, % 31, % 2015 El Quinde Ica 36, % 36, % 2015 Plaza Jesús María 14, % 14, % 2016 MegaPlaza Jaén 14,500 50% 7, % 2016 MegaPlaza Huaral 9,000 50% 4, % 2017 Peru 391,000 71% 275, % Chile Source: (1) Only partner in peru is Grupo Wiese, which includes MegaPlaza formats (50%). (2) InOutlet and Viamix includes two premium outlets in Lima and two strip centers in Lima.

15 Colombian Portfolio Colombia has 3 regional shopping centers in Colombia and the average age of the portfolio is 3 years Perú Colombia GLA (m 2 ) % Ownership Owned GLA (m 2 ) Occupancy Year of incorporation Parque Arboleda 41,000 55% 22, % 2010 Parque Caracoli 38, % 38, % 2013 Parque La Colina 62, % 62, % 2016 Colombia 142,000 87% 123, % Chile Source:ParqueArauco

16 16 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS

17 Portfolio 6. Important growth opportunities Our operations 1. Consistent results in a challenging macroeconomic environment 17 has 3 regional shopping centers in Colombia and the average age of the portfolio is 3 years 5. Conservative debt structure and outstanding financial performance Investment Highlights 2. Stable and diversified revenues 4. Solid corporate governance and increased concern with sustainability 3. Strong commercial relationships with local and global businesses

18 Consistent results in a challenging macroeconomic environment 18 Positive but weaker macroeconomic outlook and attractive industry dynamics is positioned in countries with strong macroeconomic prospects GDP GROWTH RETAIL SALES GROWTH Chile Peru Colombia Chile Peru Colombia 2.3% 1.6% 1.7% 3.3% 3.9% 3.5% 3.1% 1.9% 2.3% 7.4% 6.0% 4.9% 8.2% 4.9% 7.6% 5.9% 7.1% 7.2% f f f POPULATION (MILLIONS) GDP PER CAPITA, PPP Chile Peru Colombia Chile Peru Colombia f f f Av. Latam: , , , f 12, , , f 13, , , f Av. Latam: 15,078 Source: GDP Growth, Population and GDP Per Capita: International Monetary Fund. Retail Sales: Euromonitor.

19 Consistent results in a challenging macroeconomic environment Results have been positive in all three countries 19 Chile GLA 1 Tenant Sales 1 Country Level Revenues 1 Country Level EBITDA 1,2 +8.3% +8.4% +8.3% +7.8% 420, ,500 1,542 1, LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q % +5.4% +3.8% +9.7% Peru 374, , Colombia LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q % +75.2% % % 79, , LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q17 LTM 3Q16 LTM 3Q (1) In MMUSD using the following exchange rates: US$1= CLP , US$1= PEN 3.26, US$1= COP 2, (2) Including overhead expenses (Corporate headquarters, regional Services Center, Chile Division, Peru Division and Colombia Division)

20 Consistent results in a challenging macroeconomic environment Consistent Same Store Growth and a Healthy Occupancy Cost 20 CHILE SAME STORE SALES CHG. % CHILE SAME STORE RENT CHG. % CHILE OCCUPANCY COST % 10.7% 58% Others 42% Anchor Stores 3Q16 4Q16 1Q17 2Q17 3Q17 3Q16 4Q16 1Q17 2Q17 3Q17 3Q16 3Q17 PERU SAME STORE SALES 1 CHG. % PERU SAME STORE RENT 1 CHG. % PERU OCCUPANCY COST % 7.4% Q16 4Q16 1Q17 2Q17 3Q17 3Q16 4Q16 1Q17 2Q17 3Q17 3Q16 3Q17 COLOMBIA SAME STORE SALES 1 CHG. % COLOMBIA SAME STORE RENT 1 CHG. % COLOMBIA OCCUPANCY COST % 12.0% % Others 70% Others 59% Anchor Stores 30% Anchor Stores 3Q16 4Q16 1Q17 2Q17 3Q17 3Q16 4Q16 1Q17 2Q17 3Q17 3Q16 3Q17 1) Peru s Same Store Sales and Same Store Rent in 4Q16 do not include Larcomar due to contingencies.

21 Stable and diversified revenues diversifies its market risks at a country, format, and socio-economic level 21 COUNTRY LEVEL DIVERSIFICATION (%REVENUES) FORMAT LEVEL DIVERSIFICATION (% REVENUES) Chile Peru Colombia Regional Neighborhood Outlet Strip center 11.6% 28.6% 5.0% 5.9%1.1% 59.8% 88.0% SOCIO-ECONOMIC LEVEL DIVERSIFICATION (% REVENUES) 52 Medium to High Income: Includes ABC1 and C2 in Chile, A and B in Peru and 6, 5 and 4 in Colombia Medium Income: Includes C3 and D in Chile, C and D in Peru and 3 in Colombia Medium to Low Income: Includes E in Chile and Peru and 2 and 1 in Colombia

22 Stable and diversified revenues With a 39% market share in Chile, is the outlet market leader in the countries where we operate 22 Outlets currently in our portfolio ARAUCO PREMIUM OUTLET BUENAVENTURA, CHILE ARAUCO PREMIUM OUTLET CONCEPCIÓN, CHILE ARAUCO PREMIUM OUTLET CURAUMA, CHILE INOUTLET FAUCETT, PERÚ INOUTLET PREMIUM OUTLET LURIN, PERÚ Keys to the Premium Outlet Format >> 1 >> Location Located near main cities 2 >> Brands Premium name-brands 3 >> Discounts More than 30% discount ARAUCO PREMIUM OUTLET CURAUMA, CHILE

23 Strong commercial relationships with local and global brands Consolidated commercial relationships with well-known tenants 23 Malls Country GLA (m 2 ) Years as a client Anchor Stores >> CHILE PERU COLOMBIA CHILE PERU CHILE PERU CHILE PERU 96, ,548 48,050 33, Non Anchor Stores Source: >> 4 CHILE PERU 8, COLOMBIA CHILE 7, COLOMBIA CHILE 12 PERU 6,058 9 COLOMBIA CHILE 2, COLOMBIA

24 Strong commercial relationships with local and global brands is supporting the globalization of several brands entering the Andean region 24 NEW TENANTS PARQUE ARAUCO KENNEDY IN THE LAST 5 YEARS: NOMBRE GLA NOMBRE GLA FOREVER 21 1,639 ETIQUETA NEGRA 209 TOP SHOP 464 MICHAEL KORS 208 UNDER ARMOUR 445 RALPH LAUREN 207 LOUIS VUITTON 420 TORY BURCH 201 GUCCI 406 ERMENEGILDO ZEGNA 197 BANANA REPUBLIC 363 ENTEL 190 AMERICAN EAGLE 351 ARTE ISABEL ANINAT 161 AEROPOSTALE 342 VICTORIA S SECRET 129 DOLCE & GABBANA 316 ETAM 123 BURBERRY 276 MILK 117 EMPORIO ARMANI 247 CANELA HOME & DECOR 105 SALVATORE FERRAGAMO 241 METRO CUADRADO 114 TIFFANY & CO 219 JUSTICE 104 EL VOLCAN 218 BATH & BODY WORKS 103 BOLD 214 OCTOBER 102 OTHERS 3,020 TOTAL 14,956 INTERNATIONAL LOCAL >> 80% of new GLA leased in Parque Arauco Kennedy over the last 5 years has been leased to international brands. Many brands have opened their first store in Chile in Kennedy during the last five years including Tiffany & Co., Dolce & Gabbana, Forever 21, Bath & Body Works, Tory Burch, Victoria s Secret, Omega, Versace Collection, Vince Camuto, and BCBG. Source:

25 Solid corporate governance and increased concern with sustainability has received important recognitions from local and international organizations 25 Workplace Recognition Management Recognition was recognized by Great Place to Work in Chile and Peru in Investor Relations Recognition Best Capital Markets Strategy: Andes in Sustainability Recognition Best Investor Relations Department for Mid-Size companies according to Santander and Revista Capital in For the second year running, in 2017 Parque Arauco is part of the Dow Jones Emerging Market Sustainability Index. We are the first Latin American real estate company to be part of this prestigious index. Source:

26 Solid corporate governance and increased concern with sustainability In the last years we have continued advancing our sustainability strategy Highlights Environmental Management 1.We established the baseline for energy, water, greenhouse gases (GHG) and residual consumption in Chile, Peru and Colombia. 2.We developed an environmental management model, which will be implemented in We continued sustainably building projects in Colombia (Parque La Colina) and Peru (InOutlet Premium Lurin). 4.We began a study to identify and prioritize climate change risks in some of our assets and projects. Social Management 5.We worked on designing a community relationship strategy and policy applicable to all of operations. 6.We approved and implemented a corporate donation policy. 7.More than 20 foundations or social organization had access to free space in our assets. 8.Our intellectual disability intern program had more than 40 participants. 9.We supported more than 340 small entrepreneurs, with more than 20 local and emerging entrepreneur fairs. Corporate Governance 10. We evaluated our corporate governance practices with an expert consultant in this matter. 11. We redefined our values, purpose, mision and long term strategy. 12.We strengthened our risk management team, which performed an exhaustive examination of this matter. 13.We initiated a diagnostic with international experts in safety and security standards in our assets. 14.We continued being one of the best places to work, according to the ranking Great Place to Work. Other Highlights 15.We adhere to the United Nations Global Compact. 16. We are the first Latin American Real Estate Company to enter into the Dow Jones Sustainability Emerging Markets Index. Source:

27 Conservative debt structure and outstanding financial performance 's policy is to finance projects with 50% debt and 50% equity, and is comfortably within all its covenants 27 LIABILITIES EQUITY 0.78x 0.89x 0.81x 1.14x 1.18x 1.15x NET FINANCIAL DEBT EQUITY < 1.40x < 1.50x 0.43x 0.59x 0.47x 0.76x 0.72x x 0.78x Q Q17 EBITDAFINANCIAL EXPENSES 3.89x 3.42x 3.37x 3.33x 3.04x 3.18x > 2.50x NET FINANCIAL DEBTEBITDA 5.00x 4.25x 3.85x 5.87x 5.88x 5.72x Q Q17

28 Conservative debt structure and outstanding financial performance The Company has a conservative debt structure 28 IMPROVEMENT IN LOCAL DEBT RATING Fitch: AA- Feller: AA- ICR:AA- LIABILITY AMORTIZATION PROFILE AND DURATION 1 September 2014 (US$MM) Average Duration: 3.6 Years 267 BBB- BBB BBB+ A- A A+ AA- AA AA+ SUMMARY OF DEBT BY CURRENCY 54% UF SEPTEMBER % COP SUMMARY OF DEBT RATES 94% Fixed SEPTEMBER DEC % CLP SEPTEMBER % CLP 67% UF 12% PEN 16% PEN 11% USD 10% COP 6% Variable 93% Fixed SEPTEMBER DEC % Variable months months months months 7-12 months September 2017 (US$MM) Average Duration: 6.8 Years months months months months months 6-10 years years months months months months 6-10 years Source: (1) Does not include accrued interests and the exchange rate is at the close of September 30, years years years

29 Conservative debt structure and outstanding financial performance The cost of debt has decreased importantly in the past 5 years 29 Date: Base: 1.66% Spread: 1.74% Duration: 14.3 Date: Base: 1.62% Spread: 1.68% Duration: Date: Base: 1.46% Spread: 1.02% Duration: Generic long-term bond issued by in Chile The cost of debt of has decreased 160 points from 4.1% to 2.5% The spread five years ago had collateral agreements, while the current spread is unsecured with no collateral. Source: Risk America

30 30 Important growth opportunities has 0.9 million m 2 and a 2% market participation in Latin American and a 8% market participation in the Andean Region. Mexico GLA: 17.4 million m 2 38% of total Brazil GLA: 14.7 million de m 2 32% of total Latin America GLA: 45.4 million m 2 Indicator CHILE PERU COLOMBIA GLA (th) 3,600 2,700 4,900 GLA (th) Market Share 13% 14% 3% Rank #3 #3 #5 Andean Region GLA: 11.2 million m 2 25% of total Argentina Source: Prepared using information published by the International Council of Shopping Centers (ICSC)., Peruvian Shopping Center Council (ACCEP), Colombian Shopping Center Association (ACE) and analysis GLA: 2.1 million m 2 5% of total

31 Important growth opportunities participates in markets with a growing retail market 31 RETAIL SALES PER CAPITA AND GLA PER 1,000 INHABITANTS 1 2,500 16,000 GLA per 1,000 habitants 2,000 1,500 1, United States Canada Australia UK Chile Mexico Colombia Peru Brazil Argentina 12,000 8, Retail Sales Per Capita AT KEARNEY GRDI WINDOW OF OPPORTUNITY 2 OPENING PEAKING MATURING CLOSING Brazil Mexico Colombia Peru Chile GLA per 1,000 habitants Retail sales per capita RETAIL PRESENCE BY COUNTRY 3 (% OF GLOBAL BRANDS IN COUNTRY) 57.5% UK 51.5% United States 39.5% Mexico 21.0% Chile 20. 7% Brazil 11.7% 10.2% Argentina Venezuela 9.9% Peru Middle class is growing; consumers are willing to explores organized formats; government is relaxing restrictions Consumers seek organized formats and greater exposure to global brands; retail shopping districts are being developed; real estate is affordable and available Consumer spending has expanded significantly; desirable real estate is more difficult to secure; local competition has become more sofisticated Consumes are more used to modern retail; discretionary spending is higher; competition is fierce both from local and foreign retailers; real estate is expensive and not readily available (1) Source: International Council of Shopping Centers, World Bank, analysis (2) Source: AT Kearney Global Retail Development Index 2017 (3) Source: CBRE- How Global is the business of retail?. This report did not include Colombia.

32 Important growth opportunities 's growth has come from greenfield projects and M&A 32 43, , ,500 90,000 91, , , ,858 37,400 67% Greenfields 662,643 m 2 194,745 GLA in ,651 GLA in ,708 24, 595 GLA in 2008 GLA in 2009 GLA in 2010 GLA in 2011 GLA in 2012 GLA in 2013 GLA in 2014 GLA in 2015 New GLA in 2016 New GLA in % GLA 3Q2017 M&A 325,857 m 2 Greenfield M&A Source:

33 33 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS

34 Future Developments and onwards New Projects Type Country Format Estimated Opening Date GLA m 2 % ownership Owned GLA m 2 Investment Local Currency Parque Angamos Development Chile Neighborhood 2H18 11,000 55% 6, , Arauco Express Coquimbo Development Chile Strip Center 2H18 3,000 53% 1, ,000 6 MegaPlaza Villa El Salvador II Development Peru Neighborhood 4Q17 11,000 50% 5,500 36, Varios Proyectos SCP Development Peru Neighborhood 2H18 19, % 19, , Viamix Colonial Development Peru Strip Center 4Q17 3, % 3,000 25,000 8 Arauco Premium Outlet Bogotá Development Colombia Outlet 4Q17 13, % 13,000 78, Subtotal 60,500 48, Investment USDMM Expansions Type Country Format Estimated Opening Date GLA m 2 % ownership Owned GLA m 2 Investment Local Currency Kennedy Expansion 3 Expansion Chile Regional Hotel 2H21 11, % 11,000 5,355, Bazar Gourmet- Kennedy Expansion Chile Regional 2H18 NA 100% NA 120,000 5 El Quinde Cajamarca Expansion Expansion Peru Regional 1H18 2, % 2,500 40, Subtotal 13,500 13, Investment USDMM Projects Incorporated in 2017 Type Country Format Estimated Opening Date GLA m 2 % ownership Owned GLA m 2 Investment Local Currency Arauco Coronel Adquisition Chile Regional 1Q17 30, % 30,000 1,520, MegaPlaza Express Huaral Development Peru Neighborhood 1Q17 9,000 50% 4,500 46, Parque Lambramani Renovation Renovation Peru Regional 3Q17 NA 100% NA 23,500 7 Hotel Bucaramanga Expansion Colombia Hotel 3Q17 NA 100% NA 19,500 7 Subtotal 39,000 34, Investment USDMM New Landbank 9 113,000 96, Remaining to Invest 282 1) Projects in Chile in UF, in Peru in ThPEN and in Colombia in MCOP 2) Exchange rate as of September 30, 2017: 26,656 CLPUF, 637.9CLPUSD, 2,935.9 COPUSD, 3.26 PENUSD. 2) In addition to the 11,000 m 2, this expansion includes a 401 room Hilton by Hilton Hotel and the largest hotel convention center in Santiago.

35 35 Parque La Colina was inaugurated in December 2016 OPENING DATE: The shopping center opened on December 6, COMMERCIALIZATION STATE: 90.1% of the GLA is open. The restauarant boulevard called Social opened in September, BRANDS:

36 36 We announced a new expansion of Parque Arauco Kennedy HOTEL OPERATOR: PROJECT DETAILS: Investment: 5,355,000 UF 5-star hotel: Hilton by Hilton Rooms: 401 Convention center: 3,000 m 2 Parking spots: 700 Additional GLA: 11,000 m 2 - The project will have the first five star Hilton Hotel in Chile, a convention center, as well as the incorporation of new stores and more parking. - The five star Hilton hotel will have 401 rooms, two restaurants, three bars, two pools, a gym and an executive lounge. It will have the largest hotel convention center in the country, with the possibility of hosting over 2,800 people. - The expansion will include a new flagship Falabella store with almost 25,000 m 2 of GLA. This store will occupy the first four floors of the expansion.

37 37 Landbank Name m 2 % Ownership Cost (local currency) Cost (USD MM) Quilicura 25, % 78,000 3 Buenaventura 115, % 455, Chicureo 47, % 206,000 9 Los Andes 39, % 117,000 5 Others in Chile 57,162 99% 470, Chile 285,380 98% 1,336, Parque El Golf - San Isidro 16,350 68% 127, Chimbote 42, % 18,000 6 Talara 30, % 9,400 3 Ica 12, % 13,500 4 Chiclayo 6, % 6,300 2 Pomalca Chiclayo 45, % 6,565 2 Lambayeque- MegaPlaza 25,260 50% 18,900 6 San Juan de Lurigancho- MegaPlaza 80,000 50% 10,415 3 Others MegaPlaza 106,157 50% 85, Peru 365,393 70% 296, Neiva 49, % 18,000 6 Valledupar 46, % 30, Barranquilla 56, % 76, Colombia 151, % 124, ,476 86% 189 1) Landbank in Chile in UF, in Peru in ThPEN and in Colombia in MCOP 2) Exchange rate as of September 30, 2017: 26,656 CLPUF, CLPUSD, 2,935.9 COPUSD, 3.26 PENUSD.

38 38 Glossary»Adjusted FFO Margin - AFFO revenues»affo -Adjusted Funds From Operations: Net Profit - Depreciation & Amortization - Other Incomeexpenses - Share of Profit (Loss) of Associates Accounted - Foreign Exchange Differences - Income (Loss) for indexed assets and liabilities - Gains (losses) from the difference between the previous book value and the fair value of financial assets - Deferred tax+ Associates accounted Adjusted FFO»Controlling Adjusted FFO -AFFO attributable to the shareholders of the company»controlling FFO -FFO attributable to the shareholders of the company»ebitda - Earnings Before Income Tax Depreciation and Amortization: Revenues + Cost of Sales + Administration Expenses - Depreciation and Amortization EBITDA margin -EBITDA divided by revenues»eps -Earnings Per Share: Net income attributable to the equity holders of the companyweighted average number of shares outstanding»ffo -Funds From Operations: Net Profit - Depreciation & Amortization - Share of Profit (Loss) of Associates Accounted + Associates Accounted FFO»GLA -Gross Leasable Area. Equivalent to the sum of all the areas available for lease»greenfield Projects - Organic development of new shopping centers»landbank -Land held by the company for future development»ltm -Refers to information from the last twelve months»monthly Revenuesm 2 -Monthly revenues divided by the occupied GLA for the period»monthly Salesm 2 -Monthly tenant sales divided by the occupied GLA for the period»neighborhood Mall -A shopping mall with a GLA between 6,000 and 20,000 m 2» Net income margin -Net profit revenues»noi -Net Operating Income: Revenues + Cost of Sales + Administration Expenses - Depreciation & Amortization + Associates accounted NOI»Occupancy -GLA paying rent divided by total GLA»Occupancy cost -Minimum rent, plus variable rent, plus common expenses, plus a promotion fund that the tenants pay divided by the sales of the tenant.»owned GLA - GLA weighted by s interest in the mall»pipeline -Greenfield and expansion projects under development»premium Outlet - Shopping center located outside of the city offering name brand clothing and goods for a reduced price»regional Mall - A shopping mall with a GLA over 20,000 m 2.»SSR -Same Store Rent: Percentage change in rent collected from tenants that paid rent in both of the periods compared»sss -Same Store Sales: Percentage change in sales from tenants that reported sales in both of the periods compared»strip Center -A shopping center with a GLA less than 6,000 m 2 Tenant Sales Tenant sales of the consolidated assets»uf -Unidad de Fomento: A chilean currency unit indexed according to inflation on a daily basis.

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