Precinct Properties New Zealand Annual General Meeting 7 November 2014
Craig Stobo, Chairman
BOARD AND EXECUTIVE Management Scott Pritchard Chief Executive Officer George Crawford Chief Financial Officer Board Don Huse Independent Director Graeme Wong Independent Director Graeme Horsley Independent Director Rob Campbell Director Mohammed Al Nuaimi Director Chris Judd Director
RESULTS $117.2m net profit after tax $47.5m revaluation gain +5.5% Increase in dividend from FY13 Net operating income $63.8m net operating income after tax +9.4% increase in net operating income after tax
FINANCIAL POSITION $1.73b portfolio value Portfolio value movement +5.1% increase in net tangible assets +8.9% FY14 total return
OUR VISION Improve the quality of the portfolio and further increase our Auckland weighting. Remain a specialist investor in CBD offices able to provide end to end property solutions Portfolio asset composition Execution Undertake development Predominantly fund through the disposal of non-core assets
ANTICIPATED BENEFITS 1. Improve long term earnings 2. Improvement in the quality and average age of the portfolio 3. Reduced on-going maintenance 4. Improved operational metrics 5. Uplift in net tangible assets 6. Creation of unrivalled precincts
OUTLOOK AND DIVIDEND Flat short term earnings As the company reduces gearing levels Expect to maintain dividend During pre-funding phase progressing the sales programme and positioning for the planned developments Improved medium term earnings As vision is executed 1.35cps 2015 first quarter cash dividend payment on 11 December
BOARD FOCUS As we execute on our vision, the board will focus on maintaining an appropriate level of governance and risk management
Positioning the portfolio
KEY METRICS 98% portfolio occupancy 5.4years weighted average lease term 57,000m 2 total leasing transactions HISTORICAL PERFORMANCE
OPERATIONAL UPDATE Wellington leasing success 80 The Terrace repositioning works complete Seismic works now complete at the former Central City Police Station Leasing transactions secured at a 3% premium to 2013 valuations
OVERVIEW OF KEY EVENTS Development agreement at Wynyard Central Negotiations with Auckland Council - Queen Elizabeth square - City rail link Shortlisted by Crown, post balance date
Wynyard Central opportunity Wynyard Central
WYNYARD CENTRAL Development agreement signed with Waterfront Auckland Intend to develop in 5 stages Land is drawn at each stage commencement once occupier pre-commitment is obtained 125 year prepaid ground lease Stage 1 expected to commence in 2015
BOWEN CAMPUS One hectare of land adjacent to beehive Site offered to government as part of their Wellington accommodation plans Post balance date, Bowen Campus was shortlisted by the Crown Mayfair House, Pastoral House, No1 and 3 The Terrace and 125 The Terrace also shortlisted
DOWNTOWN PROJECT Downtown Represents an opportunity to incorporate project a number of transformational elements including public transport, international quality retail environments, world class commercial office space, urban design and public space 35,000m 2 lettable office space 20,000m 2 lettable retail space
Main trade area (MTA) MEDIUM HOUSEHOLD INCOME OF $95,000, 48% HIGHER THAN NEW ZEALAND Auckland CBD AN ASPIRATIONAL & SUPPORTIVE COUNCIL 37% OF MTA EARN $50,000 OR MORE 160,000 MTA POPULATION CBD axis shift to waterfront DOWNTOWN Tourism Transport 70% OF ALL INTERNATIONAL ARRIVALS TO NZ ARRIVE IN AUCKLAND TRANSPORT HUB - FERRY - RAIL - BUS
DOWNTOWN NEXT STEPS This project represents an opportunity to restore the waterfront as the heart of Auckland s CBD. Currently finalising concept design Conclude negotiations with Auckland Transport and Auckland Council Share plans with Auckland and lodge resource consent Secure pre-commitments by mid 2015
SALES PROGRAMME SAP Tower 125 The Terrace 80 The Terrace
MARKET OUTLOOK
OUTLOOK Short term impacts to be managed Firming investment market Wellington CBD market improving uncertainty around government accommodation improving Auckland CBD market strong good rental growth and continued occupier demand
Precinct Properties Annual General Meeting November 2014
QUESTIONS AND ANSWERS Please state your name and advise whether you are a shareholder
FORMAL BUSINESS
Resolution 1 & 2 Donald Huse, Independent Director and Chairman First appointed: 4 May 2010 Board committees: Chairman of the Audit and Risk committee, and member of the nominations and the remuneration committees. Graeme Wong, Independent Director First appointed: 4 May 2010 Board committees: Chairman of the Remuneration, and member of the Due Diligence committee.
Resolutions Resolution 1 That Donald Huse be re-elected as a director of Precinct. Resolution 2 That Graeme Wong be re-elected as a director of Precinct.
Resolutions Resolution 3 That the directors be authorised to fix the remuneration of Ernst & Young as auditor for the ensuing year.
PLEASE JOIN US FOR REFRESHMENTS DIRECTLY OUTSIDE THIS ROOM.