The Future Face of Retail; An Investors Perspective Nick Sewell, Director, NewRiver Retail PMA Conference, Manchester Thursday 14 th May 2015
The Future Face of Retail An Introduction to NewRiver Retail The Retail Market What we do Making it Happen Collaboration 2
An Introduction to NewRiver Retail NewRiver in Numbers 848 million Under asset management 3
An Introduction to NewRiver Retail Track Record Five Years of Sustained Growth 24.00 21.00 18.00 15.00 12.00 9.00 6.00 3.00 - EPRA Adjusted Profit m 21.05 9.50 4.40 5.21 0.9 2011 2012 2013 2014 2015 18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 (115%) 5.5 Dividend per share pence (Dividend cover %) (126%) 15 (102%) (98%) (116%) 17 16 16 2011 2012 2013 2014 2015 50 40 30 20 10 Gross rental income m (proportionally consolidated) 7.1 16.8 19.91 25.15 41.9 1000 800 600 400 200 Assets Under Management m 600 390 274 165 848 0 2011 2012 2013 2014 2015 0 2011 2012 2013 2014 2015 4
An Introduction to NewRiver Retail High Quality Diversified Portfolio 5
The Retail Market The Stagnant High Street Death of the High Street? Retail has an image problem Profound changes in the Industry Chronic under-investment Competition Retailing is both incredibly simple and devastatingly complicated A thriving town matters 6
The Retail Market The Strength of the Retail Market Retail Sales growth through out the downturn 20% of GDP Retail employs 1/10 th or 2.9 million of the UK working population Population growth 70m by 2028 Increased consumer confidence Diminishing vacancy rates 334billion Source: CACI May 2015 2014 Total Retail Sales 7
The Retail Market The Changing Retail Landscape 8
The Retail Market The Consumer Not just king centre of the Universe Defining consumer behaviour: Polarisation of retail Discretionary vs. non-discretionary More informed. More competition Value, convenience, lifestyle 9
What we do Business Model: Driving Income Returns UK Retail Sector Specialists Careful Stock Selection Active Asset Management Risk-Controlled Development High initial yields Low Borrowing Costs Double digit annual cash on equity returns Minimum geared IRRs of 15%+ Fully covered growing quarterly dividend Recycling of Capital 10
What we do Understanding Our Customer Capitalising on where the UK shopper spends the family budget Who is the NewRiver Customer? How does the NewRiver Customer Shop? 11
What we do Community Matters Results classic example Wallsend Community First Centre & Library Major town-transformative redevelopment Investment: 5 million Location: 2.4 miles northeast of central Newcastle. Background: Built in the 1960 s, refurbished by Land Securities in 1996. L-shaped mall with 45 retail units and external frontage onto the main High Street West Area: 91,000 sq. ft. of retail accommodation comprising a mixture of food, value and multiple retailers benefiting from a 215 space decked car park. Key Tenancies: Iceland, Superdrug, Greggs, Cooperative Travel, Barclays Bank, Boots, North Tyneside Council Mary Glindon, MP for North Tyneside We worked very closely with NewRiver at an early stage and gave commitment that if they did acquire the centre we would do whatever we could to help them make it a success Kate Lovelock, Regeneration Project Manager, North Tyneside Council 12
What we do Wallsend 13
What we do Serving up new food & leisure in the community: Regent Court, Leamington Spa We ve now got a vision locals can identify much more with what the centre is about, its much more vibrant and successful Maria Hughes, Regent Court Centre Manager Investment: 10.45m Value Range: 16m Location: 37 miles from Birmingham, 97 miles from London, 45 miles from Oxford Background: A former thoroughfare, Regent Court in Leamington Spa had a 13.5% vacancy & poor local identity Area: 91,000 sq. ft. of retail accommodation comprising a mixture of food, value and multiple retailers benefiting from a 215 space decked car park. Urban Regeneration: Securing A3 planning consent to re-position the centre into a thriving food & leisure destination improving occupancy to 5.5%. Key Tenancies: Nandos, Las Iguanas, Turtle Bay, GBK and Cote The redevelopment has drawn a lot more people into this area. As a student I ve really enjoyed that we didn t have many restaurants like Nando s before Chris Hedges, Local Student 14
What we do Regent Court, Leamington Spa: Goad Plan 15
What we do Master Planning underway to create new mixed provision: Locks Heath Shopping Village, Fareham Everyone in the surrounding areas is really positive about changes in the centre so far and what is to come! Ian Goodridge, Locks Heath Centre Manager Investment: 8.50m Location: Hampshire, 8 miles to the east of Southampton Since the Waitrose and Costa have gone into the Shopping Village there has been a real buzz about the place! A real meeting place for friends and family to do some shopping and have a coffee Fiona Mackintosh, Locks Heath Village Shopper Background:. An uncovered shopping centre with large 500 space car park acquired from the administrator Area: 95,000 sq ft of retail accommodation comprising a mixture of food, value and multiple retailers benefiting from a large surface car park and anchored by Waitrose. Regeneration: Create new mixed use town centre development to include, retail, restaurants, community and residential. Key Tenancies: Waitrose, Costa Coffee, Iceland 16
What we do Locks Heath, Fareham: Masterplan 17
What we do The Local Shopping Centre- Partnership, Investment & Relevance Vibrant, occupied Centres Local Services - Community Convenience - parking, local Destinations a reasons to visit Visibility within the centre management Engage, Collaboration Embrace technology Be fast, be bold, be different 18
Closing Remarks If everyone is moving forward together, then success takes care of itself Henry Ford 19
Discover more about NewRiver Retail Nick Sewell, Director NewRiver Retail nsewell@nrr.co.uk @newriverretail www.nrr.co.uk 20